Magnox Decommissioning Contract: Holliday Inquiry

Thursday 4th March 2021 Written Statements

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

On 27 March 2017, the then Secretary of State for Business, Energy and Industrial Strategy, my right hon. Friend the Member for Tunbridge Wells (Greg Clark), informed the House of the defective procurement between 2012 and 2014 of the contract for the clear-up of the 12 Magnox sites, of the decision taken to settle with unsuccessful bidders following a successful legal challenge, and the Nuclear Decommissioning Authority’s decision to terminate the contract on the grounds that a material change had arisen to the specification on which bidders were invited in 2012 to tender.

The Secretary of State undertook to investigate fully and expose the reasons behind these failures so as to avoid the same mistakes being made in the future. In order to achieve this, he appointed Mr Steve Holliday to chair an independent, non-statutory inquiry. Mr Holliday’s report, copies of which have been laid in the House today, delivers on that commitment.

I am grateful to Mr Holliday and his team for the comprehensive and rigorous work of this inquiry, which is reflected in this report. The team has reviewed tens of thousands of documents to get to the truth, and it is only through this diligence that we can now confidently learn from the mistakes of the past.

The Nuclear Decommissioning Authority is charged with the delivery of a range of challenging, complex and safety-critical activities, across Magnox and the other sites in its estate. Since it was established under the Energy Act 2004, the Nuclear Decommissioning Authority has driven a significant step-change in the decommissioning of the UK’s legacy nuclear sites.

The Nuclear Decommissioning Authority has already acted upon the inquiry’s interim findings that were published in October 2017 and significant improvements have been put in place. This includes strengthening of its commercial and legal capabilities and the introduction, with Government support, of a board-level programme and projects committee. My Department has already taken action to improve its own oversight of the Nuclear Decommissioning Authority by strengthening the capacity and capability of the team in BEIS that provides the sponsorship function and also by appointing a director from UK Government Investments on to the board as a Government shareholder representative.

The Nuclear Decommissioning Authority will need to continue to develop to become a more efficient, effective and resilient organisation that continues to drive transformation on the ground and to deliver value for money for the taxpayer. I will be looking to the organisation’s chair, chief executive and the other board members to demonstrate that, where they have not already done so, they will respond fully, effectively and in a timely manner to the findings of this report. There are also findings and recommendations for my Department and UK Government Investments as well as for the Government more widely which we will consider with great care.

It is my intention that the Government and the NDA will publish formal responses to the inquiry chair’s recommendations later this year.

[HCWS820]