The bill to clean up the Sellafield nuclear site in Cumbria has jumped by more than 10 per cent to £53bn, according to the National Audit Office, after the latest in a string of cost overruns to have dogged the project.
Margaret Hodge, chair of the House of Commons public accounts committee, called the £5bn increase "astonishing".
The Nuclear Decommissioning Authority's (NDA) 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," said Ms Hodge.
"It has taken far too long for the authority to deal with management incompetence at Sellafield," she added.
Her comments followed publication of the NAO report on Wednesday, which found that progress on the site's clean-up, while it had improved over the past year, remained behind schedule.
In January, ministers stripped a consortium of the management contract to clean up Sellafield, western Europe's largest nuclear waste site. Nuclear Management Partners (NMP), made up of US engineering group URS, French energy company Areva and Britain's Amec, was granted a five-year extension to its contract in 2013, despite criticism of its performance.
NMP had won the 17-year contract to run the site, worth almost £30m in performance-related fees each year, in 2008, in what was one of Britain's largest and most complex public procurement processes.
The Department for Energy and Climate Change handed control of Sellafield to the NDA, the state-run body responsible for the UK's nuclear clean-up, with the transition to the new arrangements to last 15 months.
The consortium was paid £430,000 in termination fees, a sum Ms Hodge said was "galling" to have to pay.
The site of a former munitions factory, Sellafield is a sprawling nuclear complex on the coast of Cumbria that is a symbol of Britain's atomic legacy. In the early 1950s its reactors made plutonium for nuclear weapons: it was later the site for the world's first commercial nuclear power station.
Today it is home to a huge accumulation of hazardous waste, much of it stored in ageing ponds and silos.
The NAO report, which was commissioned by the public accounts committee, said the NDA's estimate of the total discounted provision to decommission and clean up Britain's nuclear sites was around £70bn, of which Sellafield accounted for £53bn as of February, an increase of £5bn from 2013-14.
It said the NDA believed that the increase in estimated costs was mainly because "it now has a better understanding of the scale and nature of the risks and challenges on the site".
"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," said the report.
The GMB union said it had long been clear "that the NMP model did not and will not work at Sellafield".
"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," said the GMB's Chris Jukes.
(Financial Times)
