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Public body takes back nuclear work after £100M legal bill

nuclear plant for web

Nuclear decommissioning work will come back into public ownership after a botched procurement deal saw taxpayers landed with a bill of more than £100M.

The Nuclear Decommissioning Authority (NDA) will take back responsibility for decommissioning work at 12 Magnox-owned nuclear sites after announcing last year that it was terminating its £6.1bn, 14 year contract with Cavendish Fluor Partnership (CFP).

Magnox, the firm responsible for management and operation of 12 UK nuclear sites, will become a subsidiary of the NDA from September 2019, when the CFP contract ends.

A “fudged” 2012 procurement process led to an almost £100M payment in damages to losing bidders, US firm Energy Solutions and Bechtel, and further legal costs bringing the total taxpayer bill to £122M.

In February the Commons Public Accounts Committee said the NDA had “completely failed” in the procurement and management of the major government contract.

NDA chief executive David Peattie said: “This decision marks a new approach to managing the 12 Magnox sites but is consistent with a similar change we made at Sellafield in 2016, where the simplified approach is resulting in more efficient decommissioning progress.”

Peattie added that the private sector will be engaged through multiple smaller contracts, rather than through a single large parent body organisation (PBO). There had been speculation the decommissioning contract would be retendered.

A government inquiry into the procurement process found that more than 100 changes to the contract with CFP, a joint venture between Babcock International subsidiary Cavendish Nuclear and US firm Fluor, increased decommissioning costs from £3.8bn in September 2014 to £6bn in March 2017.

Last week the Public Accounts Committee (PAC) launched an inquiry into the NDA’s work at Sellafield after it emerged that decommissioning work is running £1bn over budget.

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Readers' comments (1)

  • I guess 122m pounds is small fry compared to 6 billion a year for several years, but what a loss of opportunity to put that money to good use.
    And here we are building new nukes.....seriously bad news for the future of Britain and the ultimate goal of going renewable.

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