The Nuclear Decommissioning Authority

Last Updated: 17 November 2011

The NDA spends over 95% of its annual expenditure on procurement of goods and services from the UK and international nuclear industry. This reflects the NDA's strategic role of delivering its remit through others and is achieved primarily by employing Parent Body Organisations (PBOs) to manage the Site Licence Companies (SLCs) on our behalf.  Competitions for these contracts are strategic critical procurements for the NDA (refer to Contracting and Incentivisation Strategy).  We also conduct competitions to procure the services of the supply chain directly to support our activities.

The NDA has a duty under the Energy Act 2004 to promote effective competition for contracts and as a Contracting Authority the NDA is subject to the UK Public Contracts Regulations.  In addition, we have obligations through our Management Statement and Financial Memorandum to place contracts via free, open and non-discriminatory competition and are required to follow UK Government (including OGC) best practice in application of competition and contract governance and life cycle management.

For the SLCs a contracting model has been developed which protects and develops the capability and independence of the SLC but allows a PBO to provide direction, leadership and management through ownership.

 Competition Strategy February 2011 (1Mb)

• See Contracting and Incentivisation individual strategy 

Objective

To bring the best capabilities the market has to offer, at the best price, to deliver our mission.

Scope and Boundaries

The scope covers the competition activities in relation to PBOs and their relevant SLC. 

Interfaces

The Competition Strategy is an Enabling Strategy within the NDA's Strategy Management System (SMS) and is fundamental to delivering the requirements and obligations of the NDA through its SLC supply base.  Therefore, it interfaces directly with all SMS Driving Strategies which require that the commercial aspects are identified and analysed thus ensuring that the Driving Strategy and this Competition Strategy are fully consistent

Key interfaces with the other enabling strategies include:

• Health, Safety, Security, Safeguards, Environment and Quality (HSSSEQ) strategy is related because the maintenance of high standards of health, safety, security, safeguards and protection of the environment and the public are strategic priorities for the NDA. 
• Contracting and Incentivisation strategy is related because a critical deliverable in the competition process is a robust and effective contract.
• Funding strategy is related because contracts need to be affordable, offer value for money to the Tax Payer and be appropriately flexible to meet NDA's and other bodies funding levels.
• Revenue Optimisation strategy is related because contracts need to support and deliver the revenue operations. 

Credible Options

UK and European legislation dictates the primary requirements for competitions, combined with guidance from other UK Government bodies.  The following key considerations are incorporated into each acquisition strategy:

a) The NDA places contracts for strategic, high value procurements via open competition in compliance with the European Union Procurement Directives.

b) Various contracting structures are available to allow appropriate competition of the correct activity and organisation.

c) The competition is designed to ensure safe, effective and efficient delivery of the required outcomes and services.

d) The competition must recognise the intensity of market appetite and ensure that the appropriate level of competitive tension is created to deliver value for money.

e) The competition programme needs to recognise resource and financial restrictions for the NDA, the regulators and potential bidders.

f) Through contract life cycle management the NDA will provide continuous governance and control from initial strategies through to delivering robust contracts which provide affordability, value for money and mission delivery.

Our competition strategy reflects all these considerations and provides a framework of policies and principles to develop and operate the most suitable and effective competition. 

Current Position

Where the risk or value of a procurement is significant, the NDA produces an acquisition strategy for individual competitions. This will address the management of key risks including available funding, affordability, innovation, scope for acceleration and other market factors. 

The PBO/SLC competition strategy comprises the following key elements:

a) The NDA has developed a staggered Competition Programme which recognises the resource needs of the NDA, Regulators, potential bidders and other stakeholders

b) The NDA is committed to open and non-discriminatory competition and actively seeks to offer equality of opportunity and information to all potential bidders

c) Our competitions and contracts are designed to attract UK and international suppliers who will work in partnership with the NDA and develop long term, sustainable solutions which benefit all parties – the NDA, the SLC and the PBO

d) The obligations and incentives in our contracts incorporate the NDA mission 'to deliver safe, sustainable and publicly acceptable solutions to the challenge of nuclear clean-up and waste management. This means never compromising on safety, or security, taking full account of our social and environmental responsibilities, always seeking value for money for the tax payer, and actively engaging with stakeholders.'

e) The NDA continues to seek improvements, with key opportunities being:

• Continuing to develop and improve our competition processes.
• Cultivating a competitive market for our business.
• Developing commercial and pricing arrangements that balance commercial risk with value for money, and reflect the level of uncertainty around the scope of work.
• Moving to output based arrangements where this represents value for money.
• Enhancing performance standards and obligations which reflect our needs and those of our stakeholders. 

The strategy seeks to build on previous and existing competition initiatives whilst providing a platform for continuous improvement.  The initial competition programme and model has been reviewed and developed at key points, particularly at the strategy stage of each competition.

The current strategy will continue to be implemented and monitored.

For more information see Competitions