West Midlands flood defences may be delayed after the Environment Agency was ordered to make major spending cuts.

It follows the Government's failure to pay farm subsidies o n time, leaving it a #190 million bill.

The Midlands has already experienced flooding when water surged through Cosford and Albrighton, in Shropshire, last month.

But residents near rivers such as the Severn and Teme may not get extra defences this year.

The Environment Agency is expected to cut #14.9 million from its spending on flood defences and #9 million from environmental protection.

A leaked email to senior staff from agency chief executive, Dame Barbara Young, warned of the difficulties cuts will cause.

"The fact that they have to be achieved in just over half the financial year will mean that some of the reductions will involve delaying things we would have preferred not to delay," she said. "The work we need to do is challenging."

A spokeswoman for the Environment Agency said last night: "Following discussions with the Department for the Environment, Food and Rural Affairs about a series of financial pressures, we have been asked to make savings for this financial year and next.

"Discussions are going on to identify areas where reductions will need to be made but these are not yet completed."

It followed delays making subsidy payments to farmers.

The biggest reform of agricultural subsidy in a generation backfired when it led to a 50 per cent increase in the number of claimants to 120,000, and the computer system failed to cope.

Hundreds of extra staff had to be hired and administration costs soared. Some payments were made more than seven months late, driving many farmers close to bankruptcy.

The Government has agreed to make interest payments to many farmers affected by the delays who were forced to take out bank loans to keep their businesses afloat.

MP Dan Kawczynski (Con Shrewsbury & Atcham), whose constituency is regularly hit by flooding, said: "There is already a shortfall in funding for flood defences. We cannot have any more cuts.

"I am extremely concerned about the prospect of any cuts in flood defences.

"The Government needs to deal with the cost of the farm subsidies fiasco by talking to the Chancellor and finding extra money. It cannot cut flood defences which will affect people like my constituents. It simply wouldn't be fair."

A Defra spokeswoman said that they were working to ensure that any cuts fell "equitably and proportionately" across the full range of bodies under Defra's umbrella.

"It is part of an ongoing review of our finances that we are carrying out. We are currently considering whether we will have to make further cuts this year," she said.

A spokesman added: "This will not affect capital funding for new projects. We are doing our utmost to avoid cuts which will affect important environ-mental projects."

Other unexpected costs have included preparations for avian flu, believed to have cost more than #50 million, as well as cross-departmental changes to Government accounting procedures.

A further #12 million is being cut from Natural England, the flagship conservation organisation, due to take over from the Countryside Agency in October.

In a private letter to Environment Secretary David Miliband, Sir Martin Doughty, the new chairman, said: "The scale of cuts risks the wheels coming off the organisation before October's launchpad".