The Government has earmarked more than pounds 15m for biotechnology firms, including Du Pont (UK), one of the pioneers in genetic engineering, and Monsanto, the American GM crops giant. In May 1997, the month that the Labour government was elected, it gave Monsanto the first slice of a pounds 1.5m package to expand investment in Scotland.
The revelation comes as the Government is under increasing fire for its close links with the genetic engineering firms. Firms involved in genetically modified (GM) food have met government officials or ministers 81 times since Labour was elected. Monsanto visited the agriculture and environment departments 22 times while Zeneca held 31 meetings with officials or ministers.
Last night the Government insisted there was no evidence that GM food on sale in the UK was a health risk. Such products on sale in the UK were safe, Dr Jack Cunningham, Cabinet Office Minister, said after food retailers demanded a clear statement to reassure consumers. The British Retail Consortium had warned that shops could lose billions of pounds if consumers lost confidence because of government dithering over GM food.
"No new products [containing GM substances] will be allowed for sale unless they have passed a whole series of rigorous and careful checks and tests," said Dr Cunningham.
However, last night supermarkets, including Somerfield, Asda and Sainsbury's, showed signs of turning against GM crops. They said that they were asking suppliers to buy up GM-free fields all over the world so that they could guarantee their own-brand foods such as crisps and ready-made meals were GM-free. "We are actively looking for GM-free supplies," said a spokesman for Sainsbury's. "We want to reduce the number of GM ingredients used wherever possible."
Government funds will go to a Monsanto factory in Girvan, south of Ayr, which extracts chemicals from seaweed. Monsanto, which insists that no work on genetic engineering goes on at its plant, has so far received pounds 785,000; it will be eligible for the rest of the pounds 1.5m inward investment package once it has hired more workers.
"As far as this place is concerned there is no GM work whatsoever," said a spokesman for the company.
The Government has offered Du Pont (UK), an arm of the American-based chemical multinational, almost pounds 15m to encourage it to expand factories in the North-east of England and Northern Ireland.
A spokesman for Du Pont (UK) said: "Most of our work on genetic engineering is being done in the States. We are doing some research in the UK. The money given to the plants in the North-east and Northern Ireland has nothing to do with genetic modification."
It emerged last night that Monsanto gave a pounds 140,000 research grant to an arm of the Rowett Research Institute which controversially sacked GM food scientist Dr Arpad Pusztai. The money for research into animal feed "had nothing to do with GM food".
This week a committee of MPs from all parties will be established to scrutinise government policy on GM food, and the Commons environmental audit select committee plans to launch an investigation into genetically modified organisms.
Last week MPs tabled a Commons motion congratulating The Independent on Sunday on its campaign for a freeze on growing GM crops in Britain until rigorous tests are completed.
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