The expected cost of decommissioning and cleaning up Britain’s biggest and most hazardous nuclear plant, Sellafield, has increased by £5bn in a year, to £53bn, Whitehall’s spending watchdog has disclosed.

In a progress report on the work, the National Audit Office criticised the Nuclear Decommissioning Authority (NDA), which oversees the plant, for delays in cancelling a cleanup contract with the consortium Nuclear Management Partners (NMP) after demands from MPs a year ago to do so.

The report said the contract was terminated only last month, at a cost to the taxpayer of £430,000 in cancellation fees.

Margaret Hodge, the Labour chair of the Commons public accounts committee (PAC), which will question civil servants and the NDA about the costs next week, said the rise was astonishing and railed at managerial incompetence at the plant.

“Despite my committee’s calls in February 2014 for the Nuclear Decommissioning Authority to make big improvements, the cost of cleaning up the nuclear waste at Sellafield continues to soar,” Hodge said. “The authority’s work at Sellafield is not just costing more, it is also taking much longer than planned, and for 2014-15 it looks like work will be behind schedule for the fourth year running.

“My committee concluded in February 2014 that the authority had not demonstrated why Nuclear Management Partners’ ownership of Sellafield provides value for money. Yet the authority only took the decision in January 2015 to terminate this contract with Nuclear Management Partners, which is almost a year after my committee told it to do so.”

The NDA brought in NMP seven years ago to help improve the plant’s performance. One of the members of the NMP consortium is Areva, the French engineering firm that has worked on the new nuclear power station at Hinkley Point in Somerset. The consortium also includes URS of the US and Amec of the UK.

Officials from the NDA, the Department of Energy and Climate Change, NMP and Sellafield Ltd will appear before the public accounts committee on 11 March.

In its updated report, the NAO said the estimate of decommissioning the site had been increasing sharply in recent years.

“The authority considers that the increase in its lifetime cost estimates is mainly because it now has a better understanding of the scale and nature of the risks and challenges on the site,” said the report.



“In particular, it reflects an improving understanding of the challenges, potential technical solutions and uncertainties still involved in the decommissioning projects and programmes to retrieve, package and store high risk, hazardous materials. It also reflects a more realistic assessment of the level of efficiencies achievable within the plan.”

Chris Jukes, regional officer of the GMB union, said: “Poor value for money, poor top NMP management and a lack of grip on key issues in an essential area for the UK energy sector, as well as the UK economy, have led to unbelievable decisions on expenditure.

“The PAC has undertaken some important work of scrutiny and we expect answers from NMP to some basic questions for our members in Sellafield, their families and communities.”

A spokesman for the NDA said: “The primary reason for increases in costs and schedule is because we now have a better understanding of the technical approach necessary to tackle these unique facilities.

“Before deciding whether to cancel the contract with Nuclear Management Partners, the NDA needed to first satisfy itself and government that it had an alternative model that would give greater confidence of delivering progress and value for money. We have been through a thorough process.”