Preheat the oven to 180°C/Gas 4. Line a 16 space fairy cake tin with paper baking cases.
Sift together the flour, bicarbonate of soda, salt and cocoa powder into a bowl and set aside.
In a mixer fitted with paddle attachment, mix the oil, sugar and buttermilk until combined. Add the eggs, food colouring, vinegar, vanilla and water and mix well. Add the dry ingredients a little bit at a time and mix on low, scraping down the sides of the bowl occasionally. Mix until just combined; do not over mix or the cakes will come out tough.
Divide the batter between the paper baking cases and bake for 20 to 30 minutes or until a cocktail stick inserted into the centre of a cake comes out clean. Allow to cool on a wire rack.
For the cream cheese icing:
Whip the butter and cream cheese together in a mixer fitted with a paddle attachment until creamed. Gradually add the icing sugar to the mixture, scraping down the bowl as needed. Add the vanilla and mix until combined.
Spread the icing over the top of the cakes. Alternatively it can be covered and stored in the refrigerator for up to a week.