In a speech to the Overseas Development Institute in London, he suggested some European aid programmes did not have full British confidence, and added that Britain wanted to stop the squeeze on direct, bilateral assistance to countries in need.
"Around a quarter of our aid programme is now spent through the EU. This is set to rise to above 40 per cent by 1998," Mr Hurd said.
"We have to limit the erosion of bilateral aid. That is why Britain will in future be making a reduced contribution to the European Development Fund."
Britain contributes 16 per cent of the total EU aid budget - around £510m a year. The EDF receives £172m of this. The amount that will be going to the EDF in future is still under negotiation, according to the Foreign Office.
Mr Hurd also called for EU aid to be used more effectively. "EU aid is diffuse," he said. "The EU's programmes suffer from having grown haphazard. No one would have set out to design them in their current form.
"We must do more to ensure coherence between community programmes," he added. "It makes no sense to help countries through community aid while hindering them by placing restrictions on their exports."
EU foreign and aid ministers failed to reach agreement last night on increasing assistance to partners in the developing world, French Foreign Minister Alain Jupp said.
Mr Jupp, who chaired the meeting, said: "If you added together what each of the delegations was prepared to contribute to the new European Development Fund, you would still be well short of the target."Reuse content