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Assurance of reported savings at Sellafield
Full report: Assurance of reported savings at Sellafield
The National Audit Office has today concluded that the Nuclear Decommissioning Authority’s systems for recording, scrutinizing and challenging claimed savings at Sellafield, the UK’s largest and most hazardous nuclear site, provide moderate assurance of reported overall savings since 2009-10.
The Committee of Public Accounts asked the NAO in January 2013 to review the basis on which the Authority assesses savings at Sellafield.
The original target for site wide savings was £796 million over the initial period of the ‘parent body’ agreement between Nuclear Management Partners Limited and Sellafield Limited (from 2009 to 2014) at 2012 prices.
Based on latest data, the Authority forecasts there will be site-wide savings over the initial period totalling £652 million, compared to the earlier, October 2012, forecast of £825 million. These forecast savings relate to impacts in the initial period and do not include the impacts of savings initiatives on costs in later years. During 2012-13 the Authority removed legacy ponds and silos from the savings target in order to focus these projects on achieving progress on the ground, rather than cost-savings.
The Authority tracks savings by comparing the cost of work carried out with the estimated cost of that work in the contract baseline, adjusted to remove savings not attributable to Sellafield Limited’s actions. Site-wide measurement and reporting of savings mitigates the risks of efficiency savings being claimed by reallocating costs between cost categories.
Today’s report does warn, however, that the exclusion of legacy ponds and silos from the savings target creates new risks to the accuracy of reported savings against that standard. The Authority understands the risks and to mitigate them intends to continue to monitor site-wide savings.
Notes for Editors
- Press notices and reports are available from the date of publication on the NAO website, which is at www.nao.org.uk. Hard copies can be obtained from The Stationery Office on 0845 702 3474.
- The National Audit Office scrutinises public spending for Parliament and is independent of government. The Comptroller and Auditor General (C&AG), Amyas Morse, is an Officer of the House of Commons and leads the NAO, which employs some 860 staff. The C&AG certifies the accounts of all government departments and many other public sector bodies. He has statutory authority to examine and report to Parliament on whether departments and the bodies they fund have used their resources efficiently, effectively, and with economy. Our studies evaluate the value for money of public spending, nationally and locally. Our recommendations and reports on good practice help government improve public services, and our work led to audited savings of almost £1.2 billion in 2012.
