The government and opposition joined forces to vote down a Greens motion seeking to reaffirm the tripartite commitment to the target of at least 0.5% of gross national income going to overseas aid by 2015.
"Prime Minister Gillard has effectively given Tony Abbott permission to abandon the decade old cross-party commitment to the globally agreed overseas aid budget to achieve the Millennium Development Goals," Australian Greens Leader, Senator Christine Milne, said.
"Mr Swan said his budget would look after the most vulnerable and uphold the fair go. This is not a fair go for the most vulnerable people in PNG, East Timor and 18 of our 20 nearest neighbours.
"As the Australian Council for International Development said today, what about a fair go for the 15 mothers who will die or suffer permanent disability today alone during childbirth in PNG?
"Australians are a very generous and kind-hearted people who understand our place as a rich country surrounded by very poor neighbours and personally give a lot of money to help people around the world.
"I believe that many Australians will be deeply saddened by a budget which gets into the black in no small part on the back the world's poorest people.
"It is disgraceful that Minister Carr says Australia abandoning its commitment is comparable to what the Netherlands has done. What Minister Carr fails to mention is that the Netherlands will still spend 0.6% of GNI in this financial year, well above the 0.5% by 2015 that the government had promised and is a long way from achieving.
"The UN endorsed a target in 1970 to allocate 0.7% of GNI to foreign aid. In 2000, Prime Minister Howard signed on to the Millennium Development Goals to that effect.
"With Tony Abbott now joining Julia Gillard in abandoning even the weaker commitment to 0.5%, the Greens are the only party committed to 0.7% of GNI needed to help our neighbours and others in dire straits around the world lift themselves out of grinding poverty."