The Foreign and Commonwealth Office (FCO) has drawn the short straw in the spending cuts with its budget being reduced by 24 per cent in four years.
Most of the economies will take place at the expense of diplomats based in London and administrative staff, with cuts concentrated on the diplomatic and cultural aspects of the FCO's work. Staff working on promoting exports and British companies abroad will, however, be spared.
After getting to Downing Street in May, David Cameron made a number of caustic references to the lavish lifestyle of British diplomatic staff abroad. However, according to yesterday's review, they appear to have escaped being sold off for the time being.
It is claimed, nevertheless, that a number of legations will face cuts if they are not deemed to be in countries where the UK aims to protect its influence.
The economies carried out in London will, say diplomats, have intrinsic damaging effects as the structure here is deemed to underpin all that goes on abroad.
It will also be difficult to reconcile the cuts with William Hague's declaration, in his first major speech as Foreign Secretary, that the UK and FCO would reach out to the emerging economies and the new members of the European Union.