Industry sources have challenged FSA claims this week that it is saving businesses £270m a year by reducing red tape.

The agency said the savings consisted of £225m of policy cost reductions and a £44m drop in the administrative burden. But business bosses said that although the agency had improved food safety regulation, it had introduced indirect costs.

"Food safety is the FSA's core competency and it does that very well is has worked to refine and deliver savings," said one source. "But it is imposing new costs, albeit indirectly. Addressing the complexities of the Nutrient Profiling Model and traffic lights is costly, as is responding to numerous consultations."

The agency had saved businesses "a fortune" in another way, however, he quipped. "Any money that we'd like to spend marketing our products is saved as we're not allowed to do that any more."

The FSA has also missed the mark in terms of its own targets. It said that by next year it would have cut the administrative burden by £89m a year, but its target was to achieve £136m of cuts by the end of 2010, so it is £47m off.

New European regulations were responsible for the missed target, claimed FSA chairman Jeff Rooker. "The introduction of European food and feed hygiene legislation had a significant impact on our ability to deliver the administrative burden reduction target that the board had set in 2005," he said.