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Masthead Education - Procurement and Contracts

MPs lambast public body over procurement of one of largest government contracts

The Public Accounts Committee (PAC) has heavily criticised the Nuclear Decommissioning Authority (NDA) as having "completely failed" in both the procurement and management of the contract to clean up the Magnox nuclear reactor sites.

The deal was one of the highest value and most important contracts let by Government, the PAC said in a report. “Not only did this disrupt an important component of vital nuclear decommissioning work, but it also cost the taxpayer upwards of £122m.”

The MPs said: “The NDA ran an overly complex procurement process, resulting in it awarding the contract to the wrong bidder, and subsequently settling legal claims from a losing consortium to the tune of nearly £100m.

“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 nine years early.”

The committee said the NDA would now have to spend “even more effort and money” to find a suitable way of managing the sites after the contract comes to an official end in September 2019.

“If it is to be trusted with letting future contracts 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, and then it must also monitor progress closely,” the report said.

The PAC said the failures had caused “untold reputational damage” to the NDA and raised serious questions about its credibility as a strategic contracting authority.

However, it added that central government must also share the blame. “Not only did HM Treasury and the Department approve the NDA’s approaches to procurement and contract management, but there are clear failings in the Department’s subsequent challenge and oversight of the NDA, through UK Government Investments.”

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