The Australian budget for the coming 12 months sees an increase in budgetary support to the transition of the Regional Assistance Mission to Solomon Islands (RAMSI).

Labor government Treasurer Wayne Swan revealed that defense spending is set to increase despite Australian troops withdrawing from Solomon Islands, Afghanistan and East Timor this calendar year.

The defense budget allocation has swollen from AU$103 billion spread over four years in last year's budget to AU$113 billion over four years in the latest budget.

Almost half a billion dollars of that money is going towards the transition of the Regional Assistance Mission to Solomon Islands, RAMSI.

There are cuts for the Foreign Affairs Department - but more money has been allocated to help the Solomon Islands govern itself after an Australian assistance mission withdraws this year.

Australian Defence personnel are still on track to pull out later this year. But the new money will go to improve Solomon Island's governance and financial management.

Labor government Treasurer Wayne Swan revealed that Foreign aid targets, as forecast, have been delayed.

Savings worth $88 million over six years are being found in the Australian Department of Foreign Affairs through reducing Canberra-based staff and closing the Budapest embassy.