BRITAIN is still not ready for another foot-and-mouth epidemic nearly four years after the disaster that crippled Cumbria.

A National Audit Office report released on Wednesday concluded that much progress had been made to reduce the chances of another disaster like which led to the culling of six million animals in 2001.

But it stated that a promised Government computer system to tackle exotic diseases was still not in place and even more of the illegal meat, which was blamed for triggering the outbreak, was being smuggled into the country.

The report further highlighted the European Commission's conclusion that farmers were paid as much as three times the value of their animals in compensation.

The Commission has refused to meet 60 per cent of the Government's £960 million claim, citing the "overvaluation" of animals. It also took issue with the bill for disinfecting farms, which cost UK taxpayers on average £30,000 a farm. In the Netherlands farmers were required to carry out the work at their own expense.

The Department for Environment, Food and Rural Affairs said the compensation system in use at the time, in which valuers received a percentage of the animal's cost, was flawed and had been changed. But it argued that the Commission overstated the problems.

Alistair Mackintosh, Cumbria's county chairman of the National Farmers' Union, said any overvaluation was not the fault of farmers. I can't see how a farmer could overcharge on the value of his stock, especially when the valuers were independent and employed by Defra themselves," he said.

The public accounts committee chairman, Tory MP Edward Leigh, accused the department of continuing to "drag its heels" in preparing for another outbreak and said Defra had been "dreadfully" slow in paying bills to contractors.

"Four years after the outbreak, Defra is yet to begin its planned review of some of the contractors' costs and £40 million of invoices remain unpaid."

Among the outstanding bills is a £4.5 million claim from Cumbria County Council-owned firm Cumbria Waste Management, that was involved in burying carcasses.

The report says Defra now has "one of the best" contingency plans for dealing with foot-and-mouth. A full vaccination plan has been put-in place and adequate stocks of vaccine put aside.

But it warned that a dispute which hampered the response to the last outbreak about whether to vaccinate or cull would arise again because the dairy and meat industry was still concerned about whether there would be a market for vaccinated meat and milk.

Just this week, Westmorland and Lonsdale MP Tim Collins raised these fears again at Whitehall after a meeting with local farmers at the Kendal branch of the National Farmers' Union.

"We need to know how it would work in the event of another outbreak," he said. "There must be assurances that any meat from vaccinated animals would be bought by the supermarkets."