New Zealand is to pull out of a United Nations development aid agency, ONE News inquiries have revealed.
The UN Industrial Development Organisation (Unido) aims to help the world's poorest countries, and New Zealand contributes around $500,000 a year to the fund.
But in a briefing to Parliament, the Ministry of Foreign Affairs said the Unido aid money is better spent in the Pacific as the organisation is becoming less relevant to New Zealand and its performance is mediocre.
Unido specialises in boosting sustainable industrial development in poor countries. It has a membership of 174 countries, although that no longer includes Australia or the US.
New Zealand's been a member of the Unido since its inception in 1985.
In its briefing to Parliament, Mfat acknowledges some member states could react adversely to New Zealand leaving.
The Ministry said it is possible poorer countries may now view New Zealand as less engaged in the UN.
Foreign Affairs Minister Murray McCully said the decision to
withdraw was based on an official review.
"Unido has a very minor footprint in the Pacific, where New Zealands Aid Programme is focused, its role in the international aid system is marginal, and its overall impact is limited," McCully said in a statement.
"By withdrawing our core funding for Unido we will be able to reinvest the funds in aid agencies that are able to demonstrate effective delivery on the ground and meet expectations around value for money and performance."
But Labour leader David Shearer said the move sends a bad signal to other UN member states.
"New Zealand, as a small country, gets benefit from the UN, but we also have to make a contribution," said Shearer.
The Green Party is concerned the move has come out of the blue with no consultation.
"I must say I'm surprised. This is another case of foreign
policy by stealth and the hallmark of Murray McCully," said Green
Party Global Affairs spokesman Kennedy Graham.
They say the move may also hurt New Zealand's chances of getting on the powerful UN Security Council.
Development agency Oxfam says Unido is still important.
"This UN agency isn't doing so much in the Pacific, but they are also important in terms of poverty reduction," said Oxfam Executive Director Barry Coates.
UN development programme head Helen Clark is currently working in Senegal and could not be contacted for comment.