Catholic bishops have condemned Joe Biden's "grievous" decision to reverse a policy barring taxpayer dollars from being spent on organisations that provide or promote abortions overseas. 

The Mexico City Policy was the initiative of the Reagan administration in 1984 and was re-instated by Donald Trump during his presidency. 

In one of his first actions since becoming president last week, Biden, a Catholic, reversed the policy, meaning that abortion providers like Planned Parenthood and Marie Stopes can once again receive federal funding.

"It is the policy of my administration to support women's and girls' sexual and reproductive health and rights in the United States, as well as globally," said Biden in the memorandum.

"These excessive conditions on foreign and development assistance undermine the United States' efforts to advance gender equality globally by restricting our ability to support women's health and programs that prevent and respond to gender-based violence."

Condemning the decision, the US Conference of Catholic Bishops said the memorandum "actively promotes the destruction of human lives in developing nations."

"This Executive Order is antithetical to reason, violates human dignity, and is incompatible with Catholic teaching," the bishops said.

"We and our brother bishops strongly oppose this action. We urge the president to use his office for good, prioritizing the most vulnerable, including unborn children."