United Kingdom The UK government's Department of Trade and Industry (DTI) is consulting with the public on how best to fund its £1 billion per year civilian nuclear cleanup programme. The DTI believes that the new competitive culture it plans to generate to ensure cost-effective cleanup will become a model for the rest of the world.
At least £9 billion is already earmarked for the work, just under half sitting in BNFL's Nuclear Liabilities Investment Portfolio (NLIP), and the rest with the government. The DTI wants the public to tell it by October which of two funding mechanisms should be adopted to best stimulate creation of a competitive cleanup environment.
The two funding alternatives that are being proposed are: • A segregated fund that would be set up by statute and could operate under the control of either the Liabilities Management Authority (LMA) or a separate body.
• A statutory segregated account, which is favoured by the DTI as this option would be simpler and cheaper to implement.
The segregated fund could be managed either by private sector fund managers or, possibly, by the National Debt Office in the Treasury, which is responsible for the management of the National Insurance Fund Investment Account and other public sector investment funds. The £4 billion currently held by it in its NLIP to help meet its share of cleanup costs could provide the initial endowment for the fund. It would be a rolling fund, ensuring enough funds would be available to support substantial work programmes over a period of years.
The segregated account option would be similar to a segregated fund in that a "savings pot" of money would be identified by statute which could only be spent on cleanup. However, rather than drawing money from a separate fund, the LMA would effectively be funded within the Consolidated Fund, the government's "current account" kept by the Treasury at the Bank of England. The account would be a rolling account, credited initially with the NLIP transfer to the Consolidated Fund, and thereafter topped up as with the segregated fund.
In both cases, the funds identified for nuclear cleanup would be backed by a statutory assurance that they could only be spent for that purpose. Both would provide a "rolling reserve" to ensure sufficient funds were available for the LMA's future work programme, but neither would seek fully to fund the liabilities. Both would require ongoing annual payments by the government.