Nurse put live baby boy in bag and told parents it was a dead little girl

In the latest scandal to strike China's creaking health system, officials are investigating a hospital for wrongly diagnosing a still birth and disposing of a live baby boy in a plastic bag, while telling the mother the infant was a girl in an effort to console her.

The bungled birth was in the Nanhai district of Foshan, the city in Guangdong province where a toddler died last month after being run over twice and ignored by passers-by, prompting a national crisis of conscience that China had lost its humanity.

Liu Dongmei, 23 and eight months pregnant, was brought to the hospital last month with internal bleeding and stomach cramps. After an emergency procedure, the baby was born but was not breathing and had purple skin. A nurse told the father, Wang Haizhang, that the infant was dead.

The child was put into a yellow plastic bag and the nurse disposed of the bag without reporting to a doctor, the Foshan health bureau told the Shanghai Daily newspaper. Half an hour later, family members demanded to see the body. "I opened the plastic bag and saw the baby's hands and feet moving, the stomach was going up and down and air bubbles were coming out of his mouth," Ms Liu's sister-in-law told the Foshan News. The baby was taken to intensive care and is doing well.

The parents were also told the baby was a girl; in rural China, boys are more prized than girls and pressure on women to produce male offspring is intense.

China's health system struggles to cope with its 1.3 billion people and there have been riots over botched care.

Ms Liu and Mr Wang are to sue the hospital for 300,000 yuan (£29,500). The head of the maternity ward, a doctor and two nurses have been suspended pending an investigation.