Funding allocated in the Budget to the little-known Pacific Economic Development Agency is now to go to open tender.
Radio New Zealand's Pacific issues correspondent says the u-turn follows criticism of the Government for awarding $4.8 million to a group with no track record.
The Ministry of Pacific Island Affairs has been negotiating with the agency since the Budget on a plan for service delivery, but now wants applications from other organisations.
Chief executive Colin Tukuitonga says it wants to hear from agencies able to boost skills training among Pacific Island people, especially young people.
He says applications are wanted from Pacific agencies in Auckland with a successful track record.
Dr Tukuitonga says the successful tender is expected to be selected late next month.
