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British Nuclear Group

I agree with my hon. Friend. The BNG sale enables us to assess the best bidders and to draw on their expertise, but he is right that Britain has great skills when it comes to nuclear energy. Indeed, we are very good at energy as a whole and we need to seize the chance to become one of the leading countries in nuclear power. In assessing bids for BNG, the main emphasis will be on achieving value by making sustainable clean-up improvements in the longer term. We will keep in mind the fact that a sustained 10 per cent. efficiency improvement equates to a £200 million saving on the NDA’s annual budget, which can be ploughed straight back into more work. Clearly, however, there is still some way to go and it is much too early to speculate about the commercial basis on which BNFL, working with the NDA, will organise the sale process. It is expected that the competitive sale process will start in April 2007 with completion up to six months later. Details will be updated on the NDA and BNFL websites, but it is currently expected that pre-qualification will occur at the end of the summer. Before the new year, the new draft contract will be shared with pre-qualified bidders, the regulators and other stakeholders on a fully open and transparent basis. The sale will comprise BNG and all its subsidiaries on an integrated basis: project services, Magnox and spent fuel services will all be included. Following a successful exit from its legacy contracts, BNG America, the US clean-up subsidiary, has already been sold with no continuing liabilities. Magnox has been included on the understanding that its inclusion does not disrupt the Magnox competitions due to start in 2008, or possibly 2009. Given the short time gap between completion of the sale and the start of the competitions, the new owner of BNG will not be expected to make significant changes to the running of the Magnox stations during that period. BNFL and the NDA have been maintaining a close dialogue with the unions and staff over proposals for BNG and that will continue, with the involvement of the Department as appropriate. I recognise that such fundamental change creates tremendous uncertainty for the work force, so I use this opportunity to reaffirm unequivocally that any BNFL employee whose employment is transferred to a private sector employer will receive the relevant pensions protections set out in the Energy Act 2004; or, where they do not apply, in the Cabinet Office statement of practice for staff transfers in the public sector. The sale of BNG is entirely consistent with the BNFL strategy review held in 2003, which concluded that UK clean-up should be BNFL’s priority. It envisaged that BNG would need to find partners to operate successfully in the new market being created by the NDA. The review also concluded that other parts of BNFL should be run for value and to minimise risk to the UK taxpayer. The sale of Westinghouse has already been announced. In addition, we are considering the future of BNFL’s research and development arm, Nexia Solutions, and BNFL is exploring ways of realising value from its shareholding in Urenco.