Tuesday 11 February 2014

Sellafield contractors slammed for “astonishing costs”

Sellafield contractors slammed for “astonishing costs”

The clean-up of nuclear waste at Sellafield has been dogged by “big delays and huge cost overruns”, it was claimed today.

MPs on the Public Accounts Committee released a report criticising the body which runs Sellafield for continuing to work with a group of companies despite the costs of some projects nearly doubling.

Sellafield is the largest and most hazardous of the nuclear sites owned by the Nuclear Decommissioning Authority.

The site is run by Sellafield Limited on behalf of the Authority, which reimburses its costs of around £1.6 billion a year.

To improve its performance, the consortium Nuclear Management Partners (NMP) was brought on board to help but MPs found that “little improvement has been achieved for extra money spent.”

NMP gets fees earned by Sellafield Limited for improved performance in the form of dividends.

MPs noted in their report that the company pocketed some £50 million in 2011-12, totalling £230 million over the five years of the initial contract.

Margaret Hodge MP, Chair of the PAC questioned why NMP’s contract was extended last October.

She said: “We have seen big delays and huge cost overruns on a number of major projects on the Sellafield site. But, despite this, the consortium NMP had its contract to clean up the UK’s largest and most hazardous site extended for five more years. Re-competing the contract was rejected as an option."

At the time the deal was extended, NMP claimed to have generated "substantial efficiency savings" with Sellafield.

But today Ms Hodge disagreed: “We are seeing costs rising to astonishing levels - for example, the estimated cost of the ‘Magnox swarf storage silos retrievals’ project nearly doubled from £387 million in March 2012 to £729 million in September 2013.”

The MPs conclude the NDA should monitor NMP’s activities closely and “terminate the contract should performance not improve”. In total, estimates for dealing with nuclear waste on the site exceed £70 billion.

The NDA, Sellafield and NMP were unavailable for comment when contacted by ELN.

Written by

Bruna Pinhoni

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