Insects and plants that live in the forest are being lost because too much deadwood is cleared away, according to a report published yesterday.

The World Wide Fund For Nature (WWF) said the lack of veteran trees and deadwood - on which beetles and other insects, lichens and fungi rely - is having a disastrous effect in Europe's forests.

Woodpeckers, bats and squirrels, which nest in hollow trees, have also lost their natural habitat. Species relying on deadwood for food or shelter make up the single biggest group of endangered species in Europe.

The report, launched to coincide with an international conference of forest scientists, managers and conservationists in Chambery, France, states that deadwood is at a critically low level due to a lack of recognition of its importance and inappropriate management in commercial forests and even in protected areas.

In western Europe forests have, on average, less than 5% of the deadwood expected in natural conditions, where as much as a quarter of the timber is deadwood.

Daniel Vallauri, WWF forest specialist, said: ''Europe's forests should be allowed to grow old gracefully. By stripping a forest of its decaying timber and old trees we are performing cosmetic surgery on a natural ecosystem which threatens its biodiversity.''

The conservation organisation maintains that forests with dead and veteran trees are often much healthier and more resistant to diseases, pests and climate change than young tidy forests.

The report outlines how deadwood keeps forests productive by providing organic matter and nutrients for trees, preventing soil erosion, and providing long-term storage for carbon, which mitigate some of the impacts of climate change.

WWF wants European governments, forest owners and industry to help save biodiversity by increasing deadwood in managed forests by as much as 20-30 cubic metres - about one truckload per hectare - by 2030.

It also wants an end to what it calls ''perverse subsidies'' that require the removal of deadwood, for instance after storms.

The French government pays as much as (pounds) 1200 per hectare for salvage felling without any minimum guidance for deadwood.