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Is the Ministry of Defence being subsidized by the civil nuclear industry?

Commons Public Accounts Committee – Third Report on Hinkley C 13 November 2017

Senior civil servants have revealed that the government’s decision to build a new generation of civil nuclear power stations starting with Hinkley Point is linked to maintaining enough skills to keep Britain’s nuclear deterrent. The disclosure came at a hearing of the Commons Public Accounts Committee looking at the huge cost of building Hinkley Point power station which critics see as uneconomic and not properly costed.


It was raised in a paper submitted to the committee by Professor Andy Stirling, Fellow of the Academy of Social Sciences, and Dr Phil Johnstone, from the Science Policy Research Unit, Sussex University, which questioned whether the Ministry of Defence (MOD) is being subsidized by the civil nuclear industry. Their paper pointed out this is never publicly discussed but added: “If a UK withdrawal from civil nuclear power on grounds of uncompetitive economics were to leave these shared costs borne entirely on the military side, then UK military nuclear infrastructures would be significantly more expensive.

“If civil nuclear commitments are being maintained (despite adverse economics) in order to help cover these shared costs, then it is this that amounts to a cross-subsidy.”


The point was taken up by Meg Hillier, chair of the PAC. She questioned Stephen Lovegrove, former Permanent Secretary, Department for Energy and Climate Change (DECC), on the issue. …“Mr Lovegrove, there has been an argument put forward by Sussex University that Hinkley is a great opportunity to maintain our nuclear skills base. With your hat on at the Ministry of Defence, are you having discussions with the business Department about this?”

Lovegrove replied: “We are, yes. In my last year at DECC, I was in regular discussion with Jon Thompson, former Permanent Secretary at the MOD, to say that as a nation we are going into a fairly intense period of nuclear activity … We are building the new SSBNs (nuclear armed nuclear submarines) and completing the Astutes … We are completing the build of the nuclear submarines which carry conventional weaponry. We have at some point to renew the warheads, so there is very definitely an opportunity here for the nation to grasp in terms of building up its nuclear skills. “I do not think that that is going to happen by accident; it is going to require concerted Government action to make it happen. We are speaking to colleagues at BEIS ( Business, Energy and Industrial Strategy) fairly repeatedly about it, and have a number of forums in which we are doing that.”

The Sussex University paper also pointed out that private industry was making the link. Their paper said: “Rolls Royce acknowledged for the first time in a major public statement, that there also exists a deep interlinkage between British civil and military nuclear industrial capabilities … stating that “expansion of a nuclear-capable skilled workforce through a civil nuclear UK programme would relieve the MOD of the burden of developing and retaining skills and capability. This would free up valuable resources for other investments.

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