Martin Cassidy BBC NI rural affairs correspondent

Satellite technology is to be used to combat sheep subsidy fraudsters in Northern Ireland.

Department of Agriculture inspectors are to use a hand held global positioning system devices to keep their bearings as they search for sheep across remote hillsides in all weathers.

The initiative comes after a new Audit Office report criticised the department which has accepted there have been lapses in its policing of the �20m a year farm subsidy scheme.

Instances of fraud came to light during the foot-and-mouth cull in south Armagh in 2001.

Sheep were rounded up during the cull

When asked to bring in their animals for slaughter, more than half the farmers had fewer sheep than they had been claiming subsidies for.

Sixteen farmers who had been receiving annual payments on flocks were found to have no sheep at all.

But despite being apparently caught red-handed, some farmers insisted on receiving their annual subsidies and actually received the money because of poor record keeping by the department at the time of the cull.

The Audit Office said that while the picture highlighted by the foot-and-mouth cull may not have been typical, it raised questions about whether the Department of Agriculture's inspection procedures accurately reflected the levels of fraud present.

Flock records

While department inspectors reported anomalies in sheep numbers on 8% of farms they checked, audit office staff discovered problems with sheep numbers in more than a third of the flocks they inspected.

Similarly - with farmers' records and flock markings - while the regular inspectors reported few problems on the 180 farms they checked, the Audit Office had concerns about flock markings on half the 26 farms it visited.

Staff from the Department of Agriculture registered concerns about flock records in just 1% of the flocks they inspected, but Audit Office staff found deficiencies on 68% of the farms they checked.

The department accepted there was a need to strengthen procedures to obtain a consistent approach and to increase the possibility of successful prosecutions.

The audit office noted there was only one successful prosecution from 16 cases referred to a special fraud investigation unit.

The report has called for a tougher approach to farmers who refuse to co-operate.

The Department of Agriculture may now face questions from Europe and possibly a demand to repay some of the millions provided in subsidies.