Cutting foreign aid during the current financial year will have a bigger impact on the funding of projects, a senior church leader has warned.

The level of reduction that has to be made will be greater due to it having to be found over a shorter time period, the Bishop of Southwark, the Rt Rev Christopher Chessun told Parliament.

He made the point as the Government faced criticism in the House of Lords over the move to reduce aid spending from 0.7% of national income to 0.5%, due to the economic impact of the coronavirus crisis.

The bishop said: “The minister will be aware we are already in the financial year in which the reductions in budget are meant to take place.

“Would he agree that to implement a 25% reduction in annual budget if one is for example three months into the financial year would amount to reducing a third of the funds remaining?

“This causes greater dislocation to whichever activity is supported than implementing planned funding before the financial year commences.”

Responding for the Government, Foreign Office Minister Lord Ahmad of Wimbledon said: “We have been not working in a vacuum.

“We have been working directly and liaising with organisations and institutions who are impacted, as well as countries directly.”

Labour peer Lord McConnell of Glenscorrodale said: “It is an absolute disgrace that four weeks into the financial year the Government is still hiding the figures for the organisations and the projects that are normally supported through our official development assistance and that will have particular impacts on education.”

Lord Ahmad said the “challenging situation” meant the Government had to review all aspects of spending.

Highlighting forecasts that the economy would return to pre-pandemic levels by next year, Tory peer Baroness Jenkin asked: “Why will the Government not commit to returning to 0.7% at that point?”

Lord Ahmad said the restoration of the original aid commitment would be based on “prevailing economic conditions and fiscal conditions at that time”.