Nuclear sell-off is an 'absolute shambles' says angry union

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The Independent Online

Unions have branded the Government's sell-off of its nuclear assets an "absolute shambles" after the latest U-turn in the long-running process.

The decision to sell another chunk of the industry immediately - which has yet to be approved by the Government - was made after board meetings last week.

Unions are concerned that UK companies such as Amec and Serco will be out-muscled by bigger rivals such as US group Fluor in the bidding. They are also worried that foreign companies will gain an unfair advantage in the £70bn nuclear decommissioning market and in bidding to build any new reactors. The parent company of nuclear clean-up group BNG and the body which owns its nuclear sites, the Nuclear Decommissioning Authority (NDA), approved a plan last week to sell off BNG's Magnox Electric subsidiary, which is worth at least £200m.

The subsidiary operates four ageing Magnox reactors and is decommissioning the other seven. It employs more than 3,000 workers.

BNG, via Magnox Electric, holds the contracts to operate and decommission the Magnox reactors until new contracts are awarded by the NDA. This will follow a bidding competition starting in 2008-09. Because it will take several years for the new contracts to be awarded, the new owner of Magnox Electric will hold the contracts - worth an estimated £500m a year - for around five years.

Fluor is expected to head the list of suitors if the Government allows the sale of Magnox Electric. It has more experience in nuclear decommissioning than UK companies.

But unions are worried that whoever buys the subsidiary will be in pole position to win the new Magnox decommissioning contracts, making the process uncompetitive. New reactors are also likely to be built on existing sites, which could give the owner of Magnox Electric a headstart in winning even more lucrative new-build contracts.

Unions want the new Magnox contracts to be put out to competition now, instead. Dougie Rooney, Amicus's national officer for energy, said: "It's an absolute shambles. We must ensure that the Government gets a grip on this and makes sure British interests are represented."

Under last week's new plan, BNG's project services contractor division, worth around £100m, will also be sold off immediately. BNG also holds the contract to operate the huge Sellafield site in Cumbria, but this would be retained by it until a new contract is issued in 2008.