MoD to review £2.2bn contract for Aldermaston

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British Nuclear Fuels (BNFL) is on the verge of losing a lucrative 10-year contract worth £2.2bn to operate Britain's nuclear weapons factory at Aldermaston.

The Ministry of Defence has decided to review the contract, awarded last December to a consortium led by BNFL, because of management failures and recent safety lapses at the company's Sellafield reprocessing plant in Cumbria.

The MoD said yesterday that one option is to return the management of Aldermaston to the public sector. For the past seven years the Berkshire factory has been run by Hunting-BRAE, an Anglo-American consortium whose own safety record has been criticised by environmentalists.

"The problems with BNFL have shed new light on the contract. No decision has yet been made although it has to be taken before 1 April when the current contract with Hunting-BRAE ends," an MoD spokeswoman said.

MoD officials argue that clauses within the BNFL contract to run Aldermaston emphasise safety and concern for the environment. Any new evidence showing an inability to meet these requirements jeopardises the deal, the MoD says.

In February, the Government's Nuclear Installations Inspectorate published three highly critical reports of BNFL's management and safety practices, including a critical assessment of how the company dealt with the fabrication of quality control data relating to plutonium fuel.

"Since signing the contract, the problems of BNFL have come to light and we're working with BNFL to make sure there are no implications for Aldermaston," the MoD spokeswoman said.

The BNFL consortium includes Serco, the management contractors, and Lockheed Martin, the giant American defence company which has been criticised for safety lapses at its nuclear weapons factory at Oak Ridge in Tennessee.

A third option for the MoD is to leave the running of Aldermaston with Hunting-BRAE for an interim period until the problems at BNFL have been resolved, the MoD said.

Aldermaston, which makes warheads for the Trident nuclear missile, has suffered a series of safety scares over the past few years.

Martin Salter, Labour MP for Reading West, said his constituents would be happier if the cartoon character Homer Simpson ran Aldermaston.

"I don't want BNFL and Lockheed Martin running our nuclear defence capability. There should be a new tender process and the existing management should run Aldermaston for a period of three months," Mr Salter said.

David Rendel, the Liberal Democrat MP for Newbury, has also opposed the BNFL consortium on the grounds of its poor safety record.