PNG won't expel Australian staff

Papua New Guinea's prime minister has softened his tough talk of expelling Australian public servants from his country by the end of the year.

Peter O'Neill announced moves in the parliament two months ago to turf out foreign advisers, raising concerns they were spying on his government and their presence is making local public servants lazy.

Mr O'Neill now says he does not want consultants and middlemen eating up aid budget allocations, but prefers a change to contract officers who can be accountable to his government.

"Nobody is being thrown out on the street," Mr O'Neill told AAP in Port Moresby.

"We know they have families. We are not that silly to displace families overnight."

Mr O'Neill wants to ensure those posted to PNG show loyalty to the government and to service.

"I don't think that's too much to ask for," he said.

Australia has 34 public servants on secondment to the PNG government and more than 100 technical advisers in the country.