DFAT has announced it will slash 60 positions.

The Department of Foreign Affairs and Trade (DFAT) says it will have to cut 60 positions to help it handle its budget woes in the wake of the COVID-19 pandemic.

Fifty positions will be cut from DFAT’s Canberra headquarters, while another 10 will be cut from eight overseas posts.

The department says no one will be fired, as it believes it can reach the target by “natural attrition”.

But the job cuts have been slammed by Labor and the public sector union.

Opposition foreign affairs spokeswoman Penny Wong said the cuts seem odd given the Morrison Government's efforts to boost Australia's defence capabilities.

“If we are truly going to keep Australians secure and promote our national interest, we need to be more self-reliant and ambitious in our foreign policy. Australia's diplomats are critical to this,” Senator Wong said.

DFAT made enormous efforts to help bring more than 25,000 Australians home during the early stages of the COVID-19 pandemic, but this placed additional financial pressure on the department, and staff added to DFAT's financial woes from before the outbreak.

Acting secretary of DFAT Tony Sheehan has warned staff that “the department's budget continues to be under significant pressure and this will only increase”.

Beth Vincent-Pietsch from the Community and Public Sector Union says the Morrison Government is trying to run the department “like a business”.

“This pandemic has shone a light on how important the work of DFAT is,” Ms Vincent-Pietsch said.

“Cutting jobs from the Department of Foreign Affairs and Trade is just not in our economic or national interest.”

Liberal MP and former diplomat Dave Sharma wants a funding boost.

“DFAT needs to show it is serious by reallocating staff and resources from legacy agendas, conceived in quieter times, to frontline roles that deal directly with our changing strategic environment and upholding the rules-based order,” Mr Sharma said this week.

“These sorts of changes can only be implemented by the bureaucratic leadership, not by Ministers.”