The Irish government plans to contact all 30,000 children who have been given a sub-standard vaccine over the past two and a half years but the UK health department said yesterday it saw no need to follow suit.

Dublin's move follows the recall in Britain and Ireland of tens of thousands of unadministered doses of the vaccine from PowderJect Pharmaceuticals, the controversial drugs company.

The Irish government this week signed a contract with Denmark's Statens Serum Institut to supply a year's worth of replacement vaccines, ditching PowderJect as a supplier.

But the UK health department said: "The data from our tests so far give no proof that there is an issue of efficacy with the batches [of the vaccine] provided to the UK. We don't believe any children need to be tested or revaccinated." But the government is also understood to be considering turning to SSI for future BCG vaccine.

Sample tests of vaccines produced at PowderJect's Liverpool factory revealed the potency of some batches was lower than required under licensing rules - raising concerns about doses already administered.

PowderJect has supplied BCG to UK schools and health authorities under a two-year contract since March last year.

Shortly after Paul Drayson, PowderJect's chief executive and chairman, donated a second £50,000 cheque to the Labour party, the company was awarded the government contract to manufacture millions of doses of smallpox vaccines. The vaccines will also be produced in Liverpool.

Company insiders have alleged the BCG crisis was caused by shoddy management. They have alleged that an unreasonably high number of temporary staff were used at the company's Evans Vaccines plant at Speke.

That is consistent with an investigation by the Irish Medicines Board, the industry regulator, which concluded it was "dissatisfied with the procedures adopted by the company in producing this vaccine", blaming "people and processes".

The company said last night it was "comfortable" the BCG vaccines given to children in Britain and Ireland would still provide sufficiently effective inoculation.

But Liam Fox, shadow health secretary, said the discrepancy between the governments' stances was "astonishing".

"It seems inconceivable that Alan Milburn should continue to stand back and wash his hands of what is happening."

Ireland's health department said identifying children vaccinated since April 2000, purchasing replacement vaccines and administering them would entail a "very significant cost".

Officials said in private that if PowderJect failed to cover those costs voluntarily, a claim could be made through the courts.

PowderJect said the £10m provision made to cover the vaccine recall included an assessment of that eventuality. It also insisted that no temporary staff were used on the BCG production line.

PowderJect said it was convinced it acted entirely properly in not disclosing details of the affair to the stock market when the first batch of the vaccine fell short on July 2. The Financial Services Authority has concluded in an informal check that PowderJect has no case to answer. Additional reporting by Krishna Guha and Jonathan Guthrie ...............................................................