The swine flu pandemic cost Britain more than £1.2bn despite being much less severe than feared, a government-commissioned review has found.

The actual death toll during the outbreak was 457, but the worst-case scenario predicted 65,000 people in the UK could die.

An inquiry into the handling of the emergency concluded that the government’s response was “proportionate and effective”. But it criticised restrictive contracts with drug companies that have left a stockpile of over 20 million unused doses of swine flu vaccines for England alone.

The review revealed that Britain spent £654m preparing for a possible flu pandemic, and £587m responding to last year’s H1N1 outbreak - a total of £1.24bn.

This included £1.01bn on drugs, among them anti-virals, vaccines and antibiotics, as well as £115.4m on items like face masks and respirators.

Critics questioned why the bill for tackling the pandemic was so large, with one describing Britain’s response as a “hugely expensive farce”.

But Dame Deirdre Hine, a former chief medical officer for Wales who led the review, defended the cost. “I think we have got to set these figures, which seem enormous, against the potential for saving lives,” she told reporters at a briefing in London.

“It is fairly clear, although we can’t actually identify the number, that there probably were lives saved of very young people, young children and so on. These are extremely valuable lives.”