The Federal Government has found a new place to make cost-saving cuts – reducing the allowances of Defence personnel in the Middle East.

Changes are being made to the “field allowance” soldiers receive, which is currently worth around $56 per day. The allowances will now be assessed on a case-by-case basis.

The Government said it is winding back the money at the same time as it is winding back its role in the region, as the Defence Force withdraws from Afghanistan. As living conditions have improved, the subsidy is being reduced.

Reports say other allowances of $200 per day for troops in Afghanistan and $125 per day in the Gulf States will be chopped soon too.

“The nature of service in Afghanistan and other parts of the Middle East has changed,” Prime Minister Tony Abbott said in a radio interview.

“Until the end of last year, a lot of our forces in Afghanistan were in the field - they were engaged in regular combat... that's quite different from the kind of training and support roles that they will be in this year and subsequently.”

Labor's defence spokesperson Stephen Conroy says the Government is “penny-pinching”, but those pennies could stack up to a big hit that will “punish and penalise serving ADF personnel by up to $19,000.”

“Mr Abbott is hiding behind the drawdown of troops in Afghanistan to cut the pay of people who are involved in anti-piracy, who are protecting the waterways,” Senator Conroy told reporters in Perth.

“This is 1,000 personnel who are still serving there, who are still doing the same jobs that they were before.”