BNFL to cease donations to US political parties
Wednesday 17 July 2002
British Nuclear Fuels, the state-owned reprocessing company, yesterday announced that it was banning any further financial donations to US political parties.
The announcement followed the revelation that BNFL has paid $300,000 (£193,000) to Republican and Democrat groups in the past four years including £109,000 in the financial year just gone.
Some of the donations, channelled through the company's North American subsidiaries, were made without the knowledge of Norman Askew, BNFL's chief executive.
Hugh Collum, the chairman, said: "These payments should not have been made and they will not be made in the future."
The ban on further financial donations came as BNFL confirmed it made a £2.3bn pre-tax loss last year after a huge increase in its liabilities for decommissioning its nuclear facilities.
BNFL has taken a £1.935bn charge to cover an increase in its historic liabilities and a £375m charge to cover the early closure of its Calder Hall and Chapelcross Magnox reactors.
Despite the huge loss, the biggest in BNFL's history, Mr Askew said the underlying profitability of the group had improved markedly. Profits from operations before exceptional items were £22m compared with a £210m loss in 2000-01.
Mr Collum said he welcomed the Government's go-ahead for a new Liabilities Management Agency (LMA), which will take BNFL's £40.5bn in liabilities onto its books, paving the way for the part-privatisation of BNFL's commercial activities.
But he conceded the partial flotation of the business would not now take place until after the next election in 2006 at the earliest.
Privately, BNFL executives believe that Nirex, the body set up to find a new deep underground depository should be brought under the umbrella of the LMA. Presently Nirex is 75 per cent owned by BNFL with the remainder held by British Energy and the UK Atomic Energy Authority.
Mr Collum said that nuclear power was now "firmly back on the agenda" but he conceded that a new generation of nuclear reactors would not be built until government had decided what to do with the waste produced by the current generation.
Mr Askew said the UK could take a leaf out of America's book where Congress had agreed to construct a long-term storage facility for spent fuel at Yucca Mountain in Nevada, paving the way for new nuclear reactors.
All four of BNFL's divisions contributed to the turnaround last year. The fuel manufacturing and services division, which consists principally of Westinghouse, increased profits from £52m to £78m while its nuclear decommissioning and cleanup division turned a £66m loss into a £27m profit. The Sellafield spent fuel business increased operating profits from £3m to £32m while losses from the Magnox electricity generation division fell from £191m to £115m.
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