Some Department of Foreign Affairs and Trade staff are annoyed Prime Minister Tony Abbott's daughter Louise is working at Australia's embassy in Geneva, which is headed by former Coalition staffer Peter Woolcott.

But a spokesman for DFAT said the job helping represent Australia to the United Nations was awarded on the basis of merit.

Jealousy over plum jobs in overseas locations was a staple of workplace life at DFAT, but departmental insiders said there were concerns over Ms Abbott being hired in Geneva, given the political connections of the mission's boss.

Mr Woolcott was chief of staff to foreign minister Alexander Downer from 2002 to 2004 while on secondment from the department. He had been a career officer for the department since the early 1980s. Advertisement

He was appointed ambassador in Geneva in 2010 and Ms Abbott began work as an executive assistant to the Australian mission in September 2012, when Labor was in government.

There was internal disquiet at DFAT in Canberra about what some staff saw as a lack of transparency in the hiring and how Ms Abbott came to be doing high-level work, such as delivering a public statement on disarmament, when there were up to 14 policy specialist attached to the mission.

"The position of executive assistant to Australia’s Permanent Representative to the UN in Geneva – a locally engaged position – was advertised on the Geneva mission’s website on July 4, 2012, and on www.jobup.ch and www.seek.com.au on July 5, 2012," a DFAT spokesman said.

"The recruitment process was merit based and followed departmental procedures. During that process, a three-member selection committee interviewed five applicants from a field of 28.

"Ms Abbott’s appointment was formally approved by the relevant delegate, Australia’s then permanent representative to the [World Trade Organisation] in Geneva on September 14, 2012."

Mr Woolcott was not a member of the Liberal Party. 

A spokeswoman from the Prime Minister's Office said: "The recruitment process was merit based and followed departmental procedures.

"I have nothing further to add except to say, if you have been assured that everything was transparent, above board and merits based and the appointment was made during the term of a Labor government, exactly what is your story?"

On Friday morning, the Prime Minister was on the defensive over reports daughter Frances received a $60,000 scholarship from the Whitehouse Institute of Design and that she was recommended by Les Taylor, a Liberal Party donor and chairman of the institute's board of governors. 

Mr Abbott said Frances had been awarded the scholarship on merit and that family should be kept out of the frontline of politics. 

He said he had not been lobbied by a friend to allow private colleges access to government subsidies. The budget introduced direct financial grants for students taking courses in private colleges.

Mr Abbott said questions about his daughter's scholarship was "a bit of dirt digging" and she had earned it on merit.

"I think families should be left out of it," he said.

When asked whether he had been personally lobbied by Mr Taylor for private college subsidies, Mr Abbott said:

"No, I wasn't."

Mr Abbott said he had complied with Parliament's disclosure rules.

DFAT anger over Louise Abbott's foreign affairs job