Dragon Project (Hansard, 10 March 1976)

§ Mr. Benn

, pursuant to his reply [Official Report, 16th February 1976; Vol 905, c. 470–1], gave the following information:

I have written the following letter to Mr. Springorum:

Mr. Gerd Springorum,
Chairman,
Committee on Energy,
Research and Technology,
European Parliament,
Brussels.

3rd March 1976

Thank you for your letter of 23rd January 1976 inviting me to appear before the European Parliament's Committee on Energy Research and Technology to give my views on the termination of the OECD's Dragon high temperature reactor experiment. Before you finally decide whether to invite me I thought you would like to have a full account of the stages in the discussion which eventually led to the decision to terminate the project. I hope that this will assist the Committee.

The Dragon project, since its inception in 1959, has been extended five times. The current agreement, which expires on 31st March 1976, was subject to a decision by the end of June 1975 on a further extension, if it was required.

In its White Paper of July 1974, the United Kingdom Government accepted the advice of its Nuclear Power Advisory Board that there would not be sufficient resources for a substantial United Kingdom effort on the high temperature reactor (HTR) whilst we were launching the steam generating heavy water 219W reactor and completing the advanced gas-cooled reactor programme as well as continuing our effort on the fast reactor. The Government did, however, ask those organisations in the United Kingdom concerned with the development of nuclear power to review the prospects of participation in international development of HTR.

In April 1975, the Dragon Board of Management proposed that the project should be extended for a further five years. It was not possible for the United Kingdom to agree to participate in an extension of this length before the completion of the review, I have referred to above. We were, however, aware of the risk that exhaustion of funds during the current extension might lead to premature termination of the project before a decision on a further extension could be reached. It was for this reason that in April the UKAEA made it clear that they were ready to bear their share of the costs to prevent closure before 31st March 1976, if the other signatories would do likewise.

Unfortunately, this arrangement was not acceptable to the other partners.

Although the United Kingdom was not able by the end of June 1975 to finalise its policy on the proposed extension, the necessary consultations with the nuclear industry, the Atomic Energy Authority, the Electricity Boards and the Trades Union Congress, had been completed by early September. All agreed that the benefit to our nuclear programme of the proposed extension would not justify us in continuing to bear the substantial costs which we would incur as the largest single contributor to the project. Accordingly, looked at from the standpoint of our own nuclear reactor policies, the United Kingdom Government was not in favour of a further extension of the project. However, we were conscious of our special position as the host country, and did not wish to see the project brought to an end if the other signatories wished to continue work at Winfrith under a new financial regime.

In the meantime, inflation was causing the project to run out of money. The Board of Management advised that funds would no longer be adequate to run the project until its scheduled completion on 31st March 1976 and that seconded staff would have to return to their parent laboratories from 6th December 1975 upwards. They were entitled to three months' notice of this, which meant that issue of desecondment notices could not be postponed beyond 6th September 1975.

During September, I discussed the position with other European ministers and with the interested Commissioners in Brussels and decided that the United Kingdom should try to give the ohter partners more time to make new arrangements to continue the project if they wished to do so. On 30th September, therefore, our partners were informed that the United Kingdom was not in favour of a substantive extension of the existing terms, but that we were prepared to provide some new money, contributing our existing share of the costs to the end of June 1976 if the other partners would do likewise. Because desecondment 220W had to take effect on 6th December if this offer was not accepted, it was made conditional upon acceptance by 30th November.

The United Kingdom received no formal response to this offer, but in course of discussions in Brussels the German delegation made a further proposal for an extension until 31st December 1976. The United Kingdom did not see the need for this additional six months on the ground that at least the principles of any new financial arrangements should be clear by the end of March 1976. If nothing was then in prospect there would still be time to give three months' notice of closure in June 1976. To go on till September before taking a decision, which might have been for closure in December, seemed unnecessary.

Nevertheless, I was anxious that no real opportunity for extension should be missed. Accordingly, after discussions in London between my officials, the Chairman of the Dragon Board of Management, the Chief Executive of the Project, and representatives of the federal Republic of Germany, the Commission and the UKAEA, we agreed to the German proposal for a nine-month extension subject to the conditions that, if by March 1976, there was no clear prospect of new financial arrangements in view, the termination arrangements should be put in hand and that, if the project continued under a new financial régime, this should be made retrospective to 1st April 1976. Both these conditions were discussed at the London meeting when all the participants welcomed them as constructive and believed that they should be acceptable.

We were, therefore, very disappointed to have these proposals rejected when they were presented formally to the Committee of Permanent Representatives in Brussels. We had offered to continue to pay our existing very substantial share of the costs up to the end of 1976, even though it was not in our interests to do so. The rejection of this offer indicates that none of the existing partners was prepared to contemplate paying substantially more in the longer term towards the project, even though some had a very much greater current interest than the United Kingdom. Nor, evidently, was the interest expressed by the USA on a sufficient scale to enable the project to continue in the longer term.

My officials had clearly indicated that the United Kingdom was prepared to continue its contribution to Dragon as a Community partner, and that if our Community partners wished to continue participation in Dragon we would pay our Community share in any new financial régime which could be agreed. But as I have stated, the other members of the Community were not willing to pay more than their current share of the costs of any further extension and it was not possible to bridge the gap caused by the reduction of the United Kingdom's contribution.

I hope that this account of the events which led to the decision not to extend the project beyond its present agreement will clarify for your Committee members the approach of the United Kingdom Government to Dragon.