MPs have slammed the Nuclear Decommissioning Authority (NDA) after taxpayers were left with a £122 million bill following costly mistakes surrounding the multi-billion pound Magnox nuclear reactor clean-up contract.

A report from the Public Accounts Committee hit out at the non-departmental public body after it "completely failed" in both the procurement and management of the £6.2bn contract to clean up the Magnox nuclear reactor sites.

MPs said after running an "overly complex" procurement process which saw the 14-year contract being awarded to the wrong bidder, Cavendish Fluor Partnership, it had to settle nearly £100m in legal claims from losing bidder, Energy Solutions.

The PAC said: "The NDA also drastically under-estimated the scale of the work needed to decommission the sites at the time it let the contract—another failure which ultimately led to the termination of the Magnox contract 9 years early.

"The NDA will now have to spend even more effort and money to find a suitable way of managing these sites after the contract comes to an official end in September 2019."

The PAC said in the future, if the NDA is to be trusted with letting future contract to clean up nuclear sites, it must have a "proper understanding" of the state of the sites before committing taxpayer's money to a contract, as well as monitoring progress closely.


Sir Geoffrey Clifton-Brown MP, Committee Deputy Chair, said the situation "casts serious doubt" on the NDA's ability to perform its role effectively.

"From the design and execution of the procurement process onwards, the handling of the Magnox contract has been an appalling piece of mismanagement and financial waste," he said.

"It is wholly unacceptable that some details of what took place should remain so murky – not least the NDA's inability to fully account for some £500 million of taxpayers' money paid to its previous contractor. We expect the NDA to be open with us about what it is doing to address this and other failings identified in our Report, such as shortcomings in the skills and expertise of its staff."

However, Sir Geoffrey said central government is also to blame as having signed off the NDA's procurement plan, "it then failed in its duty to taxpayers as issues emerged and costs grew".

"We accept a balance must be struck but oversight structures are there for a reason and, for a significant and critical period, UK Government Investments was simply too hands-off," he continued.

"An independent inquiry examining the Magnox contract is under way and both the NDA and central government say they are acting on its interim recommendations. Given the scale and implications of the failings set out in our Report, we are not prepared simply to take their word for it.

"In the coming months we expect to be shown concrete evidence of the progress being made."

Justin Bowden, GMB National Secretary for Energy, said the union is calling for the NDA to undergo a "radical overhaul" and be renamed as the Nuclear Development Agency.

"GMB has been saying for years that the NDA in its current form is not fit for purpose," he said.

"The PAC report givers confirmation that the British taxpayer was ripped off due to the NDA's incompetence. The PAC report supports GMB's long held view that a root and branch re-think of the NDA is required.

"We need to cut out the middle men and have this work done in-house to reduce costs and save the taxpayer money. GMB believes a radical overhaul of the NDA is now required - it should be renamed the Nuclear Development Agency and move forward under a new role and remit."

(LM)