Date: 23 June 2013
Subject: Sellafield clean-up could be taken into state hands as £22bn
contract up for review - Telegraph
Sellafield clean-up could be taken into state hands as £22bn contract up
for review - Telegraph
Nuclear waste clean-up operations at Sellafield could be taken back into
state hands after a series of failings by private companies managing the
site, as their £22bn contract comes up for review.
Sellafield clean-up could be taken into state hands as £22bn contract up
for review Nuclear waste clean-up operations at Sellafield could be taken
back into state hands after a series of failings by private companies
managing the site, as their £22bn contract comes up for review.
[image: Waste not, want not: the geology in Cumbria, home to the
Sellafield plant, is said to be 'cracked and leaky']
Sellafield is Britain's biggest and most toxic nuclear waste site. Photo:
Getty Images
[image: Emily
Gosden]<http://www.telegraph.co.uk/journalists/emily-gosden/>
By Emily Gosden <http://www.telegraph.co.uk/journalists/emily-gosden/>
8:23PM BST 20 Jun 2013
Britain’s Amec, France’s Areva and America’s URS were selected in 2008
to run the Cumbrian site for up to 17 years, in what was one of the UK’s
largest and most complex ever public procurement exercises.
*Ministers hoped that enlisting private sector management would improve
operations <http://www.nda.gov.uk/news/sellafield-contract.cfm> *at the
UK’s biggest and most hazardous nuclear site, where decommissioning is
expected to cost more than £67bn over the next century.
But the National Audit Office (NAO) and the Public Accounts Committee (PAC)
have both criticised delays and cost overruns at Sellafield, which was
fined £700,000 last week after “significant management and operational
failings” allowed radioactive waste to be sent to a landfill site.
The Nuclear Decommissioning Authority (NDA) is now reviewing whether to
renew the contract with the consortium, Nuclear Management Partners (NMP),
ahead of a “break” point in March 2014.
The NDA said it was considering three options, including stripping the
consortium of the contract and taking Sellafield back into the NDA’s hands,
a move that would require ministerial approval. It is understood to be
drawing up plans for how the site would be run if it opted to do so.
It is also in talks with NMP over possible terms for renewing the
contract, while the third option would be to rerun the tendering process.
The NDA said it expected to make a decision in September.
A spokesman said: “We have not completed our considerations and no
decisions have yet been made.
“Ultimately, our decision will be made on the basis of what is most likely
to deliver substantial progress in the clean-up programme whilst providing
value for money to the tax payer.”
In a report last year, *the NAO said performance of major projects at
Sellafield had been
“poor”<http://www.telegraph.co.uk/earth/earthnews/9659714/Warning-over-Sellafield-waste-plans.html>
*and it was “too early to judge” whether NMP was delivering value for
money, with 12 out of 14 major projects failing to deliver on target in
2011-12, while the NMP earned £54m.
Under the current contract structure, NMP is the temporary “parent body”
owner of Sellafield Ltd, whose 10,000 staff actually run the site. NMP
itself has about 100 staff embedded at Sellafield, including about 15
executives.
Margaret Hodge MP, chairman of the PAC, said in February that taxpayers
were “not getting a good deal” from the NDA’s arrangement with NMP. The
committee said payments should be reviewed to prevent “reward for failure”
and staff seconded from NMP’s parent companies were receiving “excessively
high” pay.
John Clarke, chief executive of the NDA, told the *Financial Times *this
week that he had “real disappointments” over the performance of NMP.
NDA accounts to be published next week are expected to show that the fees
paid to the consortium have been significantly cut after it failed to meet
10 out of 32 targets for 2012-13.
The original 17-year contract can be structured in three blocks of five
years and one block of two years, taken in any order. In the event the NDA
decided to retender the contract, it is thought likely it would extend
NMP’s contract for two years to cover the search for a replacement.
A spokesman for NMP said: “Four-and-a-half years into this complex and
long-term project at Sellafield, NMP has made significant progress on site
dealing with a legacy of radioactive waste dating back to the mid-Fifties.
“There have been some delays and many challenges remain, but we are proud
that we have set new safety records at Sellafield.
“NMP remains hopeful of a successful outcome to these pre-planned contract
extension negotiations and is committed to working with the NDA to meet the
challenges of the next five years and beyond.”
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