Scotland’s subsidy appeal procedure has been condemned for unfairly denying claimants legitimate funding.

An independent review group accused the appeals system of behaving like “a police force with sticks” and recommended the current procedure should be scrapped.

The group, which presented its findings to Scottish rural affairs minister Richard Lochhead, also called for a more helpful attitude from officials.

Group chairman and former NFU Scotland president John Kinnaird criticised the system, which kept farmers waiting for up to four years for the their appeals to be concluded.

The delays were attributed to inadequate staffing and resources.

“The rigorous policing of schemes has denied many claimants legitimate funding, rather than trying to ensure that subsidies were delivered to those they were intended for within the EU legislative framework,” he said.

The group’s report adds: “The point of the exercise is not to see how good farmers can be at form-filling and to punish those who fall short, but to get the money to those for whom it is intended.”

The sum of money involved in the 1188 appeals made by Scottish farmers in the last seven years amounts to little over £1m, but Mr Kinnaird said it was impossible to underestimate the impact that delays and penalties had on businesses.

The report recommends the establishment of a new independent Appeals Agency created by statute and chaired by a legally qualified director.

It also calls the creation of a Farm Liaison Team which would help improve awareness of the various aid schemes by visiting marts and agricultural shows.

The recommendations were welcomed by NFU Scotland’s chief executive James Withers, who said the existing procedure had been a huge source of frustration for members.

“In times gone by farmers viewed government officials as a source of help and advice when attempting to comply with various pieces of legislation,” he said. “In some respects that relationship has broken down and this report suggests that more carrot and less stick is the route to rebuilding that relationship.”

The minister vowed to respond to the review group’s criticisms and recommendations by the end of the year.