Mystery $3.9m payment made by DFAT

The Department of Foreign Affairs and Trade paid out just over $3.9 million to a mystery individual in an "act of grace" payment last year.

The application was lodged on January 6, 2017, but took until April 10 last year to be approved by the finance minister.

The payment, but not the name of the recipient, was revealed in an answer to a parliamentary question on notice from Labor MP Pat Conroy.

Federal laws allow such payments under "special circumstances".