GM crops back on the table to combat world food crisis

Mr Woolas said that the UK needs to look at whether GM technology can help tackle the current crisis, which has seen food riots hit countries across the world.

Mr Woolas held talks yesterday with the Agricultural Biotechnology Council, an umbrella group formed in 2000 to promote the role of biotechnology in agriculture.

In a move that has infuriated green groups, the minister signalled an end to more than a decade of government scepticism about the practical benefits of GM plants.

His remarks came as both Chancellor Alistair Darling and Bank of England Governor Mervyn King warned that global food and fuel price rises were stoking inflation to dangerous levels.

Mr King issued a stark message that he would "take whatever action is needed" to combat rising prices - a clear signal that interest rates could go up in coming months. He also said that he expected "average real take-home pay to stagnate this year".

And in a further sign that rocketing food and fuel prices were now the Government's main policy priority, Gordon Brown arrived in Paris for talks with French president Nicolas Sarkozy on the issue.

Mr Woolas suggested that the past decade of government caution regarding GM crops may end because of the urgent need to help boost farmers' yields at home and abroad.

Mr Woolas also told The Independent: "There is a growing question of whether GM crops can help the developing world out of the current food price crisis.

"It is a question that we as a nation need to ask ourselves. The debate is already under way. Many people concerned about poverty in the developing world and the environment are wrestling with this issue." The Governmenthas already decided that there is no scientific case for a blanket ban on GM crops.

But just as it is pushing nuclear power in a bid to curb greenhouse gases, the Government risks a battle with the environmental lobby.

Following much heated public debate about so-called "Frankenstein foods" the Government made clear in 2004 that commercial planting would go ahead only on a case-by-case basis if it can be shown to be safe for humans and the environment. There is no commercial-cultivation of GM plants in the UK at present, and only one trial is under way, involving potatoes in Cambridgeshire.

Green groups point out that Britain differs from the US, where huge prairie farms are not seen as wildlife havens and are used purely for agribusinesses to maximise production. In the UK, the patchwork nature of farmland means that birds, butterflies and other species rely on fields and hedgerows planted by farmers.

Critics claim that GM crops wipe out wildlife because they allow use of strong herbicides and pesticides and often fail to produce the higher yields promised by manufacturers.

But backers of the geneticallymodified technology say that some strains of crops that are drought-resistant and salt-tolerant could prove crucial in helping combat the effects of climate change.

The Chancellor made plain in his Mansion House speech to the City last night that wage restraint was another key weapon in the fight against inflation-In the speech, he said that " inflationary pay settlements would undermine rather than raise people's living standards".

Mr Brown's talks with Mr Sarkozy were set to focus on oil, food and energy prices as well as the EU treaty.

The Prime Minister was to hold discussions over lunch with the French president before travelling to Brussels for an EU summit.

HOUSE PRICES 'WILL FALL BY 9%'

A NEW warning on house price falls was issued by one of the country's biggest lenders today as it said property values will fall by nine per cent - twice its original prediction.

Halifax Bank of Scotland said its original forecast of a 4.5 per cent fall was too optimistic and that it now expected homeowners to see twice that amount lost from their properties' value.

It also said it was experiencing an increase in mortgage arrears as the increased cost of borrowing prompted by the credit crunch began to bite - and said the level of people falling behind on repayments was going to get worse.

The gloomy forecast came as householders were warned of another gas price rise on the way.

Analysts at Cazenove said they believed British Gas would impose a 30 per cent rise by Christmas, while other industry sources said 40 per cent increases were possible this winter.

The soaring cost of wholesale gas, which has risen broadly in line with the oil price, will prompt the move, analysts said.

Energy minister Malcolm Wicks said: "Given the price of a barrel of oil and the rising wholesale cost of coal and gas, it is very, very likely that we are going to see significant increases in the future.

"This is an issue affecting all countries and we must tackle it on various fronts."

CITY SLUMP HITS PETER JONES SALES

SALES at Peter Jones have been devastated by a fall in City bonuses.

Trading at the 131-year-old shop in Sloane Square began plummeting in November at the start of the bonus round and have been depressed ever since.

According to insiders, a major factor since the credit crunch hit has been a slump in demand for its " onestop shop" makeover service. This involves a Peter Jones consultant going into a customer's home and advising on all aspects of the decor.

The service can generate tens of thousands of pounds of spending in the store.

Such a service is offered by all John Lewis stores but Peter Jones, pictured, has seen by far the biggest fall in appointments. Other home supplies businesses in the area specialising in the City market say they have also suffered.

John Lewis director Nat Wakeley said: "People are saying, 'We can get another year out of the carpets and the curtains.'" Peter Jones has seen a fall in sales in 30 of the past 31 weeks. Overall sales are 10.5 per cent down on last year.

Tim Danaher, editor of Retail Week magazine, said: "When the economy is tougher one of the first things to go is spending on the home. It is not just Peter Jones, it is the whole of that area. "

BANKRUPTCIES QUADRUPLE

RECORD numbers of Londoners are going bankrupt, according to figures out today.

During the first seven years of the decade, bankruptcy in the capital quadrupled - from an average of 50 people per London borough in 2000 to 201 last year.

Experts said the trend is the result of an unprecedented period of personal borrowing and warned that the level of bankruptcies could increase by another 20 per cent this year as the credit crunch takes hold.

The borough-by-borough breakdown shows that a total of 6,632 people in London filed for bankruptcy last year, compared with 1,647 in 2000.

Pat Boyden, head of personal insolvency at PricewaterhouseCoopers, said: "These figures do not yet ref lect the impact of the credit crunch. In these conditions anyone in financial difficulty will find it increasingly difficult to get out of the red as remortgaging and consolidating loans are not as freely available as they have been."

Barking and Dagenham, Bromley, Camden, Enfield, Hackney, Greenwich, Haringey, Islington, Lambeth, Lewisham, Southwark, Tower Hamlets and Waltham Forest all saw increases of more than 300 per cent in the seven years.