The Aecom-Amec team currently delivering the clean up of nuclear waste at Sellafield is to be stripped of its £9bn contract by the government.
The Nuclear Management Partners (NMP) consortium, which also includes French energy firm Areva, has run the site as Sellafield Ltd since 2008.
It was criticised by the Public Accounts Committee and the National Audit Office, both of which blamed the private sector organisation for cost overruns and delays.
NMP’s contract was due to run for 17 years.
But today, energy secretary Ed Davey announced the contract will be torn up, to be replaced by “new, simplified management arrangements”.
The Nuclear Decommissioning Authority (NDA), which runs Britain’s nuclear decommissioning programme and which awarded the contract to NMP, said it “concluded that simplifying the relationship between the NDA and Sellafield Ltd will bring greater clarity and focus on achieving progress and value for money.”
It added: “The new arrangements will build on the success of the approach taken to complex infrastructure projects such as London’s Crossrail and the Olympics.”
NDA chief executive John Clarke said: “This decision is the result of careful consideration and review of various commercial approaches in use where the combination of public and private sector comes together to deliver complex programmes and taxpayer value.
“I believe we can build on progress to date and drive further improvements in performance and value for money by enhancing the capability of the Site Licensed Company (Sellafield Ltd) through a different approach.”
Davey said “Sellafield is the biggest and most complex nuclear site in Europe, so it’s right that we keep the way it’s being managed under constant review. We have seen great examples of how this approach can work with Crossrail and the Olympics – and I’m confident we’ll see similar results at Sellafield.”
Ownership of Sellafield Ltd will revert to the NDA. Its board will consist of existing non-executive directors and key members of the current executive team, but NDA will also appoint some directors.
The transition to the new arrangements will take place over the next 12 to 15 months.
The NDA said it would seek a “strategic partner’ from the private sector to advise and assist the Sellafield Ltd executive team – similar arrangements to those which exist on Crossrail.
Sellafield consumes 60% of the NDA’s £3bn annual budget and houses most of the UK’s civil nuclear waste.
The NDA last year increased its estimate for cleaning up the UK’s nuclear sites by 7% to £110bn over the next 120 years, most of it accounted for by Sellafied.