Malawi is one of the world's poorest countries

BBC Radio Five Live found £712,000 was spent in four years on hotels and meals for a project run by a US consultancy.

The National Audit Office said it may mount an investigation into the use of consultants by the Department for International Development (DFID).

DFID said Malawian MPs and NGOs were the beneficiaries and efforts were being made to reduce costs.

"The purpose was to debate the establishment of committees that would scrutinise the work of the Malawian government," a spokesman said.

"It was also to allow the three groups to work better together to communicate what the Malawian government was doing."

DFID said the expenses needed to be set against the £60m it was spending on Malawi aid projects this year.

The International Development Secretary Hilary Benn told the BBC there were occasions when it was "sensible" to use consultants, but the DFID was making efforts to reduce its costs.

"We did ask them to use more Malawian staff, and they're in the process of doing that," he said.

Reducing poverty

US agencies which had been brought in as consultants included the National Democratic Institute (NDI), used on a training project to improve the parliamentary committee system in Malawi.

Where there are lessons to be learnt I'm very determined that we do that

Hilary Benn, International Development Secretary

From Our Own Correspondent

Another US group, World Learning, were hired to distribute £4m of British money to strengthen Malawian society but the Tikambirane Programme was cancelled this year after six months at a cost of £300,000.

Mr Benn said the department had become concerned about that project's administrative costs.

DFID's funding priorities had also changed after the drought in Malawi which has since seen the government provide another £10m in aid, he said.

"There clearly have been some problems with the projects, and where there are lessons to be learned I'm very determined that we do that," he added.

'Phantom aid'

Five Live Report looked at several projects funded by the department in Malawi, which is considered to be the 10th-poorest country in the world.

There are large areas of the aid system that are in urgent need of reform

Patrick Watt

Action Aid

The £1m donated to the NDI project from US funds was used solely to pay its staff in Washington DC.

Over the four years of the project, the DFID donated £3m to it. Of that, £586,423 was spent on hotels in Malawi for the MPs and the NGOs. Another £126,062 was spent on meals.

An ex-staff member said computers, notebooks and other stationery had been bought in Washington DC and flown over rather than bought locally.

An NDI spokeswoman defended the spending, and said the British department had never questioned it at the time.

World Learning said the whole venture was "unfortunate for all of us but most of all for the Malawian organisations which should have been helped as a result".

Patrick Watt of charity Actionaid said: "(This is) another example of aid money not really getting down to people who most urgently need to benefit from it.

"It's an example of phantom aid, when what Malawi needs is real aid."

Mr Watt said the large amounts of money spent of administration and overseas staff meant "there are large areas of the aid system that are in urgent need of reform".