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Thursday, 4 July, 2002, 18:47 GMT 19:47 UK
'Murky finances' of nuclear legacy
Cooling towers at dusk
Ministers do not know final figure of BNFL's liabilities

Thursday's government White Paper, entitled Managing the Nuclear Legacy, is a brave attempt to shed some light on the murky finances of dealing with Britain's post-war radioactive waste burden.

But in doing so, it exposes how confused they have been, and how difficult it is to unravel exactly how much we have been paying.

And we will still have to pay for dismantling the nuclear plants built between the 1940s and the 1970s.

Part of the problem is that in the enthusiastic fervour of this brave new technology, the pioneers of nuclear power kept poor records.

general view of Sellafield plant, Cumbria
Government says tax payer always funded nuclear waste clean-up

This means as engineers start to dismantle old radioactive structures in places like the Sellafield complex in Cumbria, they often have little idea of what exactly they are dealing with.

In addition, the accounts of the state-owned British Nuclear Fuels Ltd (BNFL) were for many years in a state of confusion.

It is only recently the true scale of its financial crisis has become apparent.

In the past year alone, BNFL's estimate of its liabilities has soared from around 35bn to the astonishing figure of 40.5bn revealed on Thursday.

And officials frankly admit they have no idea how much further this figure will rise - but rise it certainly will.

With the establishment of the new Liabilities Management Authority (LMA), not the most catchy title for a new institution, this will no longer be BNFL's problem - it will be ours, the taxpayer.

'Finance shortfall'

The government argues it always has been.

It claims the change will simply make the costs of cleaning up our nuclear legacy more transparent, and more cost-effective as competition is introduced.

But one big question raised by Thursday's announcement is why more money has not been set aside to deal with these huge costs for the future.

BNFL has a fund known as the Nuclear Liabilities Investment Portfolio designed to help with clean-up costs.

But this stands at only 4bn, leaving a huge shortfall to be met by the taxpayer in coming decades.

Under the announcement, part of the clean-up will be funded by profits from BNFL's commercial operations on the Sellafield site.

This will in future be in the hands of the LMA.

Reviving nuclear industry

But with real doubts about the future viability of nuclear fuel reprocessing, it is not at all clear there will be any profits.

All of this comes as the government comes close to a decision on whether to attempt to revive the nuclear industry.

It is looking at incentives to enable new power stations to be built, once the current generation comes off stream over the next 20 years.

The implications for the future of the industry are double-edged.

On the one hand, it provides some certainty for BNFL and frees it of the huge historic burden it has had to carry.

On the other, it brings home the true cost of the nuclear industry's past.

And it could make the prospect of new stations even less attractive to the public, whatever reassurances are given about the ability of new technology to minimise waste.


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See also:

20 Dec 01 | England
28 Nov 01 | UK Politics
02 Jul 02 | England
04 Jul 02 | UK
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