Extra money could be provided to help the thousands of people whose homes were flooded in the recent storms, ministers suggested today.

However, they refused to make any specific commitments to increasingly anxious councils in Hull and south Yorkshire.

A spokesman for the prime minister, Gordon Brown, said the government was looking at extra funding for flood-hit areas “as a matter of urgency”.

“The prime minister is keen to be kept fully informed on what’s happening,” he said. “He has spoken to the leaders of the councils in Sheffield, Doncaster and Hull in recent days.”

The communities secretary, Hazel Blears, was repeatedly challenged on funding pledges when she toured the Meadowhall shopping centre in Sheffield, which was closed for five days last week when its ground floor was swamped.

“It is absolutely vital that the local authorities, who have been in the lead and have done some fantastic work, are supported by a complete cross-government effort, and we’ll be ensuring that that happens,” she said.

“We need to look at is the existing emergency funding scheme, we need to see the extent of the damage, we need to bring all our resources to bear - not just financial but the human resources of local people, businesses, of the government offices in the regions.

“This is a national effort because we know that the problems that have been suffered by people are not going to go away once the immediate floodwater has gone away … that’s why there’s a pledge of ongoing support, particularly working with those local councils.”

Ms Blears rejected claims that the response would have been far quicker if the flooding had hit London. No ministers visited the flooded areas for the first five days, which coincided with the change of government.

The junior minister John Healey, the head of the recovery programme, gave the same message in Hull, where the number of damaged homes has topped 17,000 - approaching one-fifth of the city’s stock.

The council’s Liberal Democrat leader, Colin Minns, told him the government needed to “help us with a large injection of capital, otherwise this city will not recover”.

In Hull, the father of a young fish farm worker who died after a failed four-hour attempt to free him from a drain accused the emergency services of “virtually arguing” about what to do.

Michael Barnett, 68, said his 28-year-old son, who was also called Michael, could have been saved. “Even if it [a rescue] had broken his leg or pulled his foot off, at least he’d be alive,” he said. “But they just left him to die.”

Humberside Fire and Rescue said it could not discuss details because the death was going to a coroner’s inquest.

However, the chief fire officer, Frank Duffield, said the team involved had acted in a “dedicated and professional manner with little regard for their own safety”.

The country’s biggest insurance firm, Aviva, yesterday said it could meet around 175m of the 1bn expected in insurance claims following the floods.

The company anticipated that the claims would make a dent in its profits, and but admitted that figure could rise even further depending on the average claim made and if the bad weather continued.

Aviva has already received around 30,000 Norwich Union claims, and expects the average household figure to be below 15,000.

At least 27,000 homes and 5,000 businesses are thought to have been affected, but that number is rising daily.

Sue Winston, of Aviva, said it could take up to a month for all the claims to come through. Loss adjusters and suppliers were visiting stricken areas to process claims as quickly as possible.

Meanwhile, Royal & Sun Alliance said it expected to pay out an estimated 55m in flood claims after recoveries from its own reinsurers.

After the floods of 2000, the insurance industry paid out a total of 1.3bn, of which Aviva assumed 200m.

(07-05) 09:34 PDT NEW YORK, (AP) —

Stocks slipped in uneven trading Thursday, as jitters over rebounding bond yields dampened Wall Street’s excitement about new buyout activity and strength in the U.S. service sector.

The Institute for Supply Management’s index of service sector activity in June rose to 60.7 from 59.7 in May, indicating that non-manufacturing industries saw slightly faster expansion. The figure was better than expected, fueling sentiment that the economy is recovering from a slow first quarter.

However, the data weighed on bond prices, which were already weak after payroll company Automatic Data Processing and consultancy Macroeconomic Advisers said 150,000 private jobs were created last month Д a good sign that the Labor Department’s June payrolls data Friday will show a solid rise.

As prices fell, the 10-year Treasury note’s yield shot up to 5.14 percent Thursday from 5.04 percent Tuesday. On Monday, the 10-year yield had slipped below the 5 percent level for the first time since early June, when the benchmark yield surged past 5 percent to a five-year peak of about 5.30 percent.

Robust data is a double-edged sword for the stock market; though investors want the economy to strengthen, they remain worried that it will cause rates to rise, which can slow down business.

But the 10-year Treasury yield would have to rise significantly higher to do any real damage to the stock market, said Joe Balestrino, a portfolio manager at Federated Investors Inc. “If things are good, yields are supposed to be a little higher.”

Also hurting the Dow Jones industrial average was General Motors Corp., one of blue-chip index’s 30 components, which was downgraded by a Bear Stearns analyst after the automaker on Tuesday posted a 21.3 percent drop in June sales compared to last year.

In midday trading, the Dow fell 38.05, or 0.28 percent, to 13,539.25.

Broader stock indicators were lower. The Standard & Poor’s 500 index was down 3.23, or 0.21 percent, at 1,521.64, and the Nasdaq composite index fell 1.06, or 0.04 percent, to 2,643.89.

The technology-heavy Nasdaq performed better than the other indexes due in part to Apple Inc., which rose $3.62, or 2.9 percent, to $130.79.

Trading volumes were low Thursday, as they were earlier in the week, with many traders taking time off before and after the 4th of July holiday. Light trading can exacerbate price swings in a nervous market.

Many on Wall Street remained confident about stocks amid takeover news. Hilton Hotels Corp. agreed Tuesday to an all-cash buyout from Blackstone Group in a $20.1 billion deal; chemical company Huntsman Corp. said Wednesday a private equity firm made a cash buyout offer of about $6 billion that trumps last week’s bid from a Dutch company; and a Coca-Cola Co. spokesman said Wednesday the company is looking into buying Cadbury Schweppes PLC’s Snapple iced tea brand or building its own tea brand.

After agreeing to private equity buyouts, Hilton Hotels soared $9.46, or 26 percent, to $45.51, and Huntsman jumped $3.08, or 12.6 percent, to $27.48.

Coca-Cola slipped 26 cents to $52.64, while GM fell $1.41, or 3.7 percent, to $36.57 after the analyst downgrade.

The dollar fell against most major currencies after the Bank of England raised its benchmark rate by 0.25 percent for the fifth time in less than a year to 5.75 percent, and the European Central Bank indicated it might raise rates later in the year.

Gold prices fell.

Light sweet crude futures fell 20 cents to $71.21 a barrel on the New York Mercantile Exchange, after the Energy Department reported crude oil and gasoline inventories increased last week. The data had little discernible effect on stock trading.

Declining issues outnumbered advancers by about 3 to 2 on the New York Stock Exchange, where volume came to 587.1 million shares.

The Russell 2000 index of smaller companies fell 0.14, or 0.02 percent, to 848.11.

Overseas, the often-volatile Shanghai Composite Index plunged 5.3 percent due to worries about government steps to cool down the market and concerns that several new share listings could dampen prices.

Japan’s Nikkei stock average rose despite the drop in China’s stock market, gaining 0.29 percent. Britain’s FTSE 100 fell 0.57 percent, Germany’s DAX index fell 1.09 percent, and France’s CAC-40 fell 0.63 percent.

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(AP)President Bush’s pick to head the Consumer Product Safety Commission withdrew his nomination Wednesday amid strong opposition from some Senate Democrats because of his career as a manufacturers’ lobbyist.

The White House said it was reluctantly accepting the decision by Michael Baroody after “some members in the Senate rushed to judgment.”

Baroody is a lobbyist for the National Association of Manufacturers, and his critics on Capitol Hill said he would not provide the leadership the agency needed in order to protect consumers.

Democrats also had raised questions about a $150,000 payment that Baroody would have received from the manufacturers’ lobbying group when he left.

The White House took issue with the critics, who included Democratic presidential candidate Sen. Barack Obama. Baroody had served in the Labor Department, where he was assistant secretary of policy during the Reagan administration.

“The president selected Mr. Baroody to serve in this position because of his strong commitment to protecting American consumers, his impressive leadership record and extensive public service,” the White House said in a statement. “We are disappointed he will not have the opportunity to strengthen the CPSC’s ability to protect American consumers.”

The White House said “it became evident to Mr. Baroody that he would not be confirmed.” The statement added that the process will begin immediately to find “another qualified and committed leader to serve in this important position.”

A Senate subcommittee hearing on Baroody’s nomination had been scheduled for Thursday. Democratic Sens. Bill Nelson of Florida and Richard Durbin of Illinois wrote Mr. Bush last week saying the nomination should be withdrawn.

“Mr. Baroody is a consummate professional, but his ties to the industries he would have had to regulate were just too strong, creating at least the appearance of a conflict of interest,” Nelson said in a statement after the withdrawal.

Obama said Baroody made the right decision. Baroody’s nomination highlights the need to slow a revolving door that creates conflicts of interest between government officials and the industries they’re supposed to be overseeing, Obama said.

NAM President John Engler said Baroody was the victim of an unprincipled smear campaign … aided and abetted by unethical release of his financial records.

“Watching this abuse of process, apparently without consequence for the wrongdoers, makes me wonder why any qualified citizen would submit to run today’s Senate gauntlet,” Engler said in a statement.

A controversial $150,000 payment the manufacturers group would have given Baroody when he left for government was arranged with NAM senior managers in an agreement in January 2006, long before he was considered for the consumer agency post. However, a change was made to his agreement early this year when he was under consideration. Nelson, Durbin and Obama asked the president to provide details on the payment.

In addition, Senate Democrats made clear that they would raise questions about how Baroody intended to deal with potential conflicts of interest at the agency, which has been at odds with Baroody’s employer on a variety of issues.

The three-member commission has been working without a chairman since Hal Stratton left in July 2006. Because of that prolonged vacancy, the two-member panel has been unable to vote on new federal rules or new civil penalties since January of this year. Under federal law, CPSC can operate with two commissioners for just six months.