The safety of the world's most widely used insecticide has been questioned by a parliamentary inquiry, with MPs accusing regulators of "turning a blind eye" to the risk for bees.

A growing body of scientific evidence has linked the widespread use of neonicotinoid pesticides on crops to a serious decline in the bees and other pollinators, which are vital in producing a third of all food. The inquiry has uncovered evidence, apparently ignored by regulators, that the toxic insecticide can build up in soil to levels likely to be lethal to most insects, including the bees that overwinter in soil.

"European regulators seem to have turned a blind eye to data on the danger that one of the world's biggest selling pesticides could pose to bees and other pollinators," said Joan Walley MP, chair of the Environmental Audit Committee (EAC). "Evidence seen by the committee raises serious questions about the integrity, transparency and effectiveness of EU pesticides regulation. Data available in the regulators' own assessment report shows it could be 10 times more persistent in soils than the European safety limit."

The insecticide in question is called imidacloprid and is manufactured by Bayer. Prof Dave Goulson, an ecologist at the University of Stirling, said: "The data show unequivocally that imidacloprid breaks down very slowly in soil, so that concentrations increase significantly year after year with repeated use, accumulating to concentrations very likely to cause mass mortality in most soil-dwelling animal life."

The decline of bees has previously been blamed on starvation as meadows and other habitats are ploughed up, and from diseases and parasites, such as the varroa mite. But a flurry of peer-reviewed studies in 2012 have singled out the harmful effects of neonicotinoids, from making bees lose their way home to failing to produce enough queens. The European Food Safety Authority (EFSA), which assesses the risks of pesticides accepted earlier in 2012 that current "simplistic" regulations contain "major weaknesses". But the UK government has failed to follow countries including France, Germany, Italy and Slovenia in suspending the use of some neonicotinoids, although it has accelerated its research on the issue.

The environment minister Lord De Mauley told the EAC on Wednesday: "The advice to government has been and remains that there are no unacceptable effects. If new work gives rise to a change in advice, we will take it." He added: "At the moment, I am satisfied that [European regulatory system] is working properly."

Imidacloprid was first approved for use in the EU in 1991 but was re-evaluated in 2006 with Germany, where Bayer is based, selected to carry out the assessment. Based on six-year trials in the UK done in the 1990s, it concluded that imidacloprid concentrations in the soil built up but reached a plateau. However, as part of the approval process, this report was then assessed by the EFSA, which reached a contradictory conclusion stating that "experts considered a plateau had not been reached".

Furthermore, EFSA calculated the half-life of the insecticide – the time for half to degrade – in the soil at 1,333 and 1,268 days in the UK trials, performed on winter barley. A half-life of more than a year means annual application of the insecticide can lead to a dangerous build-up in the soil. The EFSA failed to highlight the issue of soil accumulation as an action point or a cause for concern in its report and imidacloprid was re-approved by member states in December 2008.

Julian Little, communications manager at Bayer, said: "The UK study used relatively high levels of treatment and involved six successive years of barley growing; something that is not by any means considered 'normal' in the UK. The data derived would be expected to be right at the extreme end of the spectrum of possibilities." He pointed out other studies conducted at the same time in Germany found a half-life of 182-288 days.

However, other national regulators have reported a very long half-life for imidacloprid, with Canada's authority recording a half-life "on the order of one to two years" and the US environmental protection agency once extrapolating a half life of 7,000 days. In Australia, the pesticide authority identified a half life of up to 1,400 days. In 2009, the EU introduced a new regulation requiring any plant protection substance approved for use to have a half life of less that 120 days.

Referring to the 2006 report written by German officials, Walley said: "EU rules allowing member states to give the green light to pesticides manufactured in their own countries may now need to be changed."

Evidence submitted to parliament cites a long list of failings in current regulations. They include that it is only the effects on honeybees that are considered, despite 90% of pollination being performed by different species, such as solitary or bumblebees, hoverflies, butterflies, moths and others. Another is that the regime was set up for pesticide sprays, not systemic chemicals like neonicitinoids that are used to treat seeds. Even the National Farmers Union (NFU), which argues that there is no need for a change of approach to neonicitinoids, told MPs: "It is very well known that the current pesticide risk assessment systems for bees were not developed to assess systemic pesticides."