Government has slashed funding to a key United Nations agency by more than 80 per cent,

The Federal Government has slashed funding to a key United Nations environment agency by more than 80 per cent, stunning environmental groups ahead of a global climate change summit in Peru. 

The ABC has learned the Government cut $4 million from the UN Environment Program (UNEP), which provides advice on environmental policies and climate change negotiations.

"Whether it's air pollution, whether it's ozone depleting substances, what's happening in the world's oceans, the conservation of biodiversity - for a relatively small amount, Australia benefits from leveraging well over $500 million in contributions that other countries make," UNEP's executive director Achim Steiner said.

Australia was due to contribute around $1.2 million this year, but has only offered $200,000.

Over the next four years it will scale back its funding by $4 million.

Environmental groups are stunned, especially because according to UNEP's Voluntary Indicative Scale of Assessments, Australia should have contributed around $2.2 million next year.

"As an executive director, you have to be disappointed because clearly the contribution of member states is what enables UNEP to fulfil its mandate and be of service to the global community," Mr Steiner said.

"It is probably the most effective return on investment if you think about it because Australia cannot work with 193 countries bilaterally on addressing some of these issues.

"Therefore the value proposition of joining forces with a relatively small contribution and leveraging virtually 500 times as much financing from others seems to be something that I hope Australia will consider once again as a very good investment, and one that has benefited Australia and also the Pacific region."

But Environment Minister Greg Hunt said the Government had to "make choices in a difficult budget environment".