CORRECTED - UPDATE 1-Northwest Air flouted safety-US gvt report

(Corrects date of Delta purchase of Northwest in paragraph 7 to 2008 from last year)

* FAA proposed disciplinary action vs airline managers

* Airline will cooperate with gov't (Adds comment from Delta)

July 23 (Reuters) - Northwest Airlines flouted federal safety orders in the past but the Federal Aviation Administration (FAA) did not hold it accountable, a U.S. government report said.

The report by the Transportation Department's inspector general's office followed allegations that FAA managers had colluded with the airlines they were charged with inspecting.

In 2008 FAA inspector Mark Lund charged that FAA inspectors who oversaw Northwest's safety requirements had allowed the airline to avoid civil penalties or legal action by accepting voluntary disclosures of non-compliance in contravention of FAA policy.

The report was made public on Thursday by the U.S. Office of Special Counsel (OSC) which handles whistleblower complaints.

"The report substantiated Lund's complaints that FAA inspectors in charge of Northwest failed to provide effective oversight of airline's safety process, resulting in the carrier's continued systematic non-compliance of safety rules."

FAA had proposed disciplinary action against two Northwest managers, the OSC said.

Northwest was bought by Delta Air Lines Inc (DAL.N) in 2008, creating the world's largest airline.

Delta Air Lines said: "We are currently reviewing the documents and, as always, we will fully cooperate with the government agencies to ensure our core values of safety, quality and compliance are not compromised." (Reporting by Sakthi Prasad in Bangalore; Editing by Samia Nakhoul, Sharon Lindores)