Friday, 23 June 2017

Contractors' conflict of interest scandal shadow looms over Hinkley C

Letter sent to the Times:
Your environment editor mentions in passing (“Hinkley nuclear deal ‘cost public £15  billion more than it should have, “ The Times, 23 June; ) LeighFisher, a technical consultancy  had a potential conflict of interest in its role advising ministers  on the Hinkley Point  C (HPC)  nuclear power plant  deal.
But the reason the National Audit Office report concluded “The arrangements the {Business} Department put in place to manage the potential conflict of interest were insufficient” are quite extraordinary, and underpin why such a bad financial  decision to go ahead with plant  could have happened, and could now cost taxpayers up to an extra £30 billion (
Inexplicably the Government appointed LeighFisher to advise independently on the prospective costs of HPC, for a taxpayer–funded fee of  £1.2 million. NAO states that this “largely involved providing technical services to verify whether EDF’s construction cost estimates [for HPC] were reasonable.” It renewed the original 2012 contract in 2015.

Ministers knew all along that LeighFisher was a subsidiary of the Jacobs Engineering  Group, that the NAO  explains “had provided engineering and project management services, including seconded staff, to EDF in relation to the HPC deal.”
This poacher and gamekeeper role should have been obvious to anyone, and, as such huge sums of public (ie taxpayers’) money were involved, should have set alarm bells ringing in ministerial ears.

Instead, a series of ineffectual measures to obviate the conflict of interest were set up, but, NAO records, “LeighFisher only signed the agreement for ‘ethical wall arrangements’ in October 2015”

NAO rightly excoriates ministers concluding the responsible Department “did not stipulate to LeighFisher the arrangements required to manage the potential conflict from the outset of the engagement in 2012. This means there was no active consideration or assurance that the conflict of interest did not have an impact on LeighFisher’s work.

NAO adds that “even when the responsible Department did stipulate ethical wall arrangements, they were below the standard we would expect in this sort of engagement.”

Worse still, NAO reports that the Government admitted LeighFisher indeed had “input from Jacobs’ employees during its cost verification exercise.”

This devastating report surely should be the very first  put under examination when the Public Accounts Committee is imminently reformed in Parliament.

NAO has unveiled very expensive scandal, for which taxpayers will pay very heavily.

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