15 year delay to nuclear submarine disposal risks costs of £30m

The Public Accounts Committee has today published a report on Submarine Defueling and Dismantling.

The project has moved at a glacial pace and the 15-year delay has led to extortionate storage and maintenance costs which are now costing the taxpayer £30 million per year. The MoD is also looking increasingly likely to find itself without any further storage space by the mid-2020s.

The report also states that the MoD is rapidly approaching crisis point and simply cannot afford any further delays, particularly as much of the money currently being spent on the project is not going directly towards either defueling or dismantling.

“It is clear that the commitment to dismantle its first submarine – Swiftsure – by 2023 will not be met and will likely be completed three years after the target date. The scale of the task faced by the Department appears even more challenging given the defence affordability ‘black hole’ which totals at least £7 billion.”

According to report, there are three main issues:

• MoD’s failure to dispose of retired nuclear submarines is unacceptable and unnecessary
• Further delays to submarine disposal possible as first dismantling will be three years late
• By the mid-2020s, Department is likely to find itself without any further storage space

The UK retired its 20 legacy submarines in 1980 and the Ministry of Defence’s progress in disposing of these submarines has been a serious disappointment, warns the report.

“While it has taken the Department 16 years to devise a workable dismantling strategy, it is encouraging to see that progress is now being made and there is finally some momentum behind the project. However, while there is now an agreed policy, we remain sceptical that the ambitious timetable will be met, particularly given how many times this project has been delayed or deprioritised over the years.”

Commenting on the Report, Meg Hillier MP, Chair of the Public Accounts Committee, said:

“Yet again, the Government has failed to see the bigger picture. In an attempt to save money in the short term by delaying the defueling and dismantling of retired nuclear submarines, the MoD is now spending £30 million a year of taxpayers’ money on storage and maintenance. The MoD has spent £500 million since 1980 on such storage and maintenance. This is simply unacceptable.

Whilst some progress has been made recently with submarine disposals, the MoD cannot afford to fall any further behind. The Public Accounts Committee has set out a series of milestones for the MoD to ensure that it keeps on track to establish submarine disposal as a routine part of its business.”

Recommendations

To sustain momentum behind this work, the report argues that the MoD must provide certainty over longer-term funding as soon as possible. It should do this by:

• urgently clarifying department-wide priorities and making decisions to delay, defer or descope areas of the programme so as to plan funding on a longer-term basis;
• being clearer on the priority of disposal-related projects and how this may change over time; and
• work with the Department for Business, Energy & Industrial Strategy and HM Treasury on the scope of the Energy Act 2004. The Department cannot access the decommissioning funds ringfenced as part of this Act and it should work with these other departments to push for change.

The report also recommends that given the importance to the UK of developing a broad pool of skilled engineering talent, the Department and Babcock should set out by December 2019 its strategy for exploiting opportunities across disposal projects, such as working with universities, with the aim of increasing the size of the skilled workforce.