HC Deb 04 July 1979 vol 969 cc608-9W
Mr. Pawsey

asked the Secretary of State for Energy (1) whether the Central Electricity Generating Board is continuing with its intention to place the turbine generators for the Drax B power station with Northern Engineering Industries; and whether these orders were placed as the result of competitive tender;

(2) by how much the Northern Engineering Industries' price for turbine generators for Drax B power station exceeds the price offered by GEC; what was the amount of the subsidy to be paid by his Department to the Central Electricity Generating Board; and what cost per job maintained in Northern Engineering Industries this sum represents;

(3) by how much the date of ordering Drax B has been brought forward as a result of Government intervention; how much money has been and will be paid to the Central Electricity Generating Board by way of compensation for early ordering of Drax B, and what subsidy per week for early ordering this represents; and whether any of the money voted by Parliament has been or will be used to cover the higher price the Central Electricity Generating Board paid to Northern Engineering Industries than it would have paid as the result of competitive tendering.

Mr. Norman Lamont

The previous Government were advised by the CEGB that the order for Drax B would have been placed in 1980 without Government intervention.

Under the Nuclear Safeguards and Electricity (Finance) Act 1978, compensation to a maximum of £50 million may be paid to the board; compensation payments are calculated by reference to expenditure actually incurred by the board on the station as a whole—not on particular items of equipment—in the financial year preceding the payment. So far, £23,769 has been paid in respect of expenditure incurred in 1977–78.

The CEGB was asked by the previous Government to negotiate with Parsons (NEI) for the turbo-generators for Drax B. The commercial details of the main contract finally negotiated are a matter for the board which has said that it is satisfied with the price agreed. There is no question of payment of a subsidy to NEI. Contracts for the manufacture and erection of the generators were placed with NEI in November 1978.