A third of court fines were not collected allowing criminals to avoid paying £74 million, according to the government's auditors.

In a highly critical report released on Friday, the National Audit Office (NAO) warned the failure to collect fines could undermine their credibility as a form of punishment and called for urgent improvement.

Compensation awards to victims and prosecutors' costs totalled £385 million - but only £242 million was recovered.

The £74 million in uncollected fines has now been written off, the NAO found. In many cases the debtor could not be traced.

Auditors criticised the process of enforcement as "over-complex and time consuming".

They said some cases required many court hearings and other enforcement action.

The report called for better arrangements to obtain and verify details of offenders' means prior to sentencing. It also called for the Home Office to pass laws to enable magistrates' courts to increase fines that are not paid promptly.

Sir John Bourn, head of the National Audit Office, said major work was needed to improve the situation.

"Significant improvements are needed to the management of the enforcement process, for example by improving the information available to magistrates on offenders' means prior to sentence, ensuring that enforcement action is taken promptly, and providing greater support to staff through better training and improved management information," he said.