UPDATE 1-UK’s Food Standards Agency to be abolished-source

* Health and environment departments to take over duties

* Agency had promoted “traffic light” food labeling
(Adds Department of Health response paragraph 9)

By Tim Castle

LONDON, July 11 (BestGrowthStock) – Britain’s coalition government
will abolish its food watchdog, set up to protect consumers
after the “mad cow” disease crisis, and reassign its duties
elsewhere, a government source said on Sunday.

The cost-saving move will fulfill a pre-election pledge by
Health Secretary Andrew Lansley to strip the Food Standards
Agency (FSA) of its responsibilities for nutrition and diet
advice.

But it is likely to fuel criticism that Lansley is bowing
to the food industry, which has opposed the agency’s approach
of using “traffic light” colors for food labeling.

The agency, which employs 2,000 staff and spends 135
million pounds ($205 million) a year, is also in charge of
safety and hygiene in the food chain and those duties will be
devolved to the Department for Environment, Food and Rural
Affairs (Defra).

“The functions of the FSA will be subsumed into the
Department of Health and Defra,” the source told Reuters.

The Conservative-Liberal Democrat coalition, in power since
May, is looking for deep cuts across the government to reduce a
budget deficit of 156 billion pounds, although it has promised
to protect health spending.

Lansley said Sunday he was seeking nearly 190 million
pounds a year in savings from independent agencies or
“arms-length bodies” to spend elsewhere in the state-funded
National Health Service (NHS), on top of an 850 million pound
squeeze on management costs.

On Monday, Lansley will unveil a radical shake-up of the
NHS, with family doctors taking over responsibility for more
than 80 billion pounds of spending from local health
authorities.

A Department of Health spokesman said no decision had been
made over the FSA. “All arms-length bodies will be subject to a
review,” he said.

The FSA was founded by the Labour government in 2000 in the
aftermath of the crisis that rocked Britain’s beef industry and
damaged the public’s confidence in food safety.

Lansley has been critical of the agency’s promotion of
traffic-light food labeling to tackle rising levels of obesity,
saying its approach was counter-productive.

The opposition Labour party says Lansley is caving into
pressure from the food industry that opposes the
red-amber-green labels that show the relative amounts of salt,
sugar and fats.

Britain’s biggest retailer Tesco Plc (TSCO.L: ) has resisted
the program although it has been adopted by some high-street
rivals, including J Sainsbury Plc (SBRY.L: ) and Marks and
Spencer Group PLC (MKS.L: ).

Last month, the European Parliament rejected the mandatory
use of traffic-light food labeling while insisting that
nutritional content should be clearly shown.
($1=.6593 Pound)
(Editing by Jeffrey Benkoe)

UPDATE 1-UK’s Food Standards Agency to be abolished-source