PRIME Minister Julia Gillard says the government is "working through" allegations that Australian aid money is going into a fund that is being used to pay for fake and ineffective anti-malarial drugs in some of the world's poorest countries.
Australia has agreed to put $100 million into a global fund to provide drugs to combat the spread of malaria, but it has been reported in the United States that the fund is the subject of corruption in at least four countries.
Ms Gillard told reporters in the Cambodian capital of Phnom Penh at the end of the East Asia Summit that she was aware of the allegations and they were being examined.
"We, through our aid program, take a very rigorous approach to the expenditure of Australian dollars and we have monitoring and checking processes," she said.
Ms Gillard said Australia had a lot of experience in fighting diseases and knew how to "make a difference".
"We've put a lot of vaccine into kids' arms and down their throats ... but of course you have always got to be vigilant about the expenditure of every Australian dollar," she said.
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