THE troubled Government agency which bungled the payments of crucial subsidies to farmers should be "abolished" instead of reviewed, a Westcountry MP said last night.

Chaotic handling of European Union subsidies by the Rural Payments Agency (RPA) pushed many farming families to the brink of collapse in 2005.

The fiasco – branded a "shocking indictment" of Government incompetence – also cost the British taxpayer £75 million in fines from the EU.

A review of the agency has now been ordered by the Government, which insists the move is routine, ahead of changes to European agriculture rules.

Farmers' leaders have welcomed the review, and called for better co-operation with the industry.

However South West Devon Conservative MP Gary Streeter called on Ministers to go further and axe the RPA entirely.

"It has not covered itself in glory since its inception and it has seemed to stumble from one administrative blunder to another," Mr Streeter said.

"The review is long overdue and I hope it will end in the agency being abolished so that we can find a better way of distributing money to our farmers."

The RPA is again mired in turmoil with fears over the inaccurate mapping of farmland, used to calculate payouts. Critics argue it shows that the agency "is still an incompetent organisation".

And it has been warned that a number of "significant or serious errors" have already been reported, and "another complete disaster" is threatened.

Ministers have pledged to tackle the latest problems, with complaints about inaccurate mapping of farmland being a top priority.

The review, headed by Director General of the Food and Farming Group within the Department for Environment, Food and Rural Affairs (Defra), will examine the running of the Single Payment Scheme (SPS), and identifying where improvements and efficiencies can be made.

It will take account of previous criticism of the RPA, which has an office in Exeter.

Officials declined to rule out cuts or job losses, but stressed this was not the purpose of the exercise, and that there was no reason for concern at the RPA. One of the main aims is to "avoid any deterioration in the RPA's current ability to make payments to farmers", they said.

Farming Minister Jim Fitzpatrick said: "This review is being carried out in the usual course of business to ensure that the RPA is ready to react to any changes to the Common Agricultural Policy in 2013.

"It benefits us all to ensure that the RPA is operating efficiently and I look forward to the final outcome of the review."

A Defra spokesman said: "It's business as usual. This review is being done by Defra for management purposes. This isn't a review with a view to make cuts.

"Nothing is being discounted – all the options are on the table. We can't predict the outcome of a review."

But he added: "There shouldn't be any reason for the RPA to be worried."

The work of the review is due to be completed by March next year.

Welcoming the review, Anthony Rew, who farms near Newton Abbot and is chairman of Devon National Farmers' Union, said: "There are a lot of problems that are mostly of the RPA's making, like this mapping fiasco.

"What it needed to do was to work with the industry. It could all work so much better."

"We need them to work in a much more customer-focused way that works with the farming community, so we get a better outcome. There doesn't need to be this confrontation all the time. They could achieve more by working with us."

Henry Aubrey-Fletcher, president of the Country Land and Business Association, said although "matters have got a lot better since Tony Cooper took over as chief executive", the review had been "too long coming".

"English farmers have been in the hands of one of the worst agencies in the UK and one that is among the slowest in the EU in making SPS payments," he said.