Hazardous waste at Sellafield, Britain’s largest nuclear power plant, poses “significant risks to people and the environment”, a report today claims.

The UK’s public spending watchdog, The National Audit Office (NAO), warns that “any significant containment failure, particularly in legacy storage ponds and silos, could result in highly hazardous radioactive material causing enduring contamination”.

The NAO also concludes that clean-up projects at the site in Cumbria have so far been “poor” and that there are “significant uncertainties and scheduling risks”.

Since 2008, Sellafield has been managed by a ‘parent body’ consortium of Areva, AMEC and URS, which is overseen by the Nuclear Decommissioning Authority (NDA).

Last year the NDA unveiled a lifetime plan for the clean-up of Sellafield by 2120, with a price tag of £67bn.

So far, 55 buildings at Sellafield have been decommissioned, but a further 1400 remain. Of these, 240 are operating nuclear facilities or legacy buildings containing radioactive materials. In the 2011-2012 financial year, £1.6bn was spent on running and cleaning up Sellafield, with £411m going on major projects.

The NAO report today states that there is “considerable uncertainty over the time required and cost of completing facilities to treat and store highly radioactive material held in deteriorating legacy ponds and silos”.

While it praises the parent body for improvements in commercial operations on the site, including the reprocessing of spent nuclear fuel, it found that some of the NDA’s 14 major projects at Sellafield have not provided good value for money. These projects are for the design and build of complex chemical engineering projects to retrieve, package and store hazardous nuclear material from old facilities. The projects range in cost from £21m to £1.3bn. “Twelve of these projects delivered less than planned during 2011-2012, which could delay risk and hazard reduction,” states the report.

Amyas Morse, head of the National Audit Office, said today: “Owing to historic neglect, the NDA faces a considerable challenge in taking forward decommissioning at Sellafield. It is good that the authority now has a more robust lifetime plan in place but it cannot say with certainty how long it will take to deal with hazardous radioactive waste at Sellafield or how much it will cost.”

Morse added that “securing future value for money will depend on the authority’s ability to act as an intelligent client, to benchmark proposed levels of performance and to provide better contractual incentives for making faster progress towards risk and hazard reduction”.

Margaret Hodge, an MP who chairs the government’s Public Accounts Committee, said: Sellafield has suffered from decades of neglect, saddling taxpayers with a century-long clean-up job with a £67bn price tag. Projects of this length and ambition are ripe for dithering and delay. I am dismayed to discover the clean-up of Sellafield is no different.

“My concern is that unless the authority holds Sellafield Limited to a clear and rigorously benchmarked plan, timetables will continue to slip and costs spiral. It is totally unacceptable to allow today’s poor management to shift the burden and expense of Sellafield to future generations of taxpayers and their families.”

In a statement today, Sellafield Ltd said: “We welcome the report and are pleased that the NAO recognise the globally unique challenge we are facing in cleaning up and decommissioning the site.

Sellafield said that it had “taken steps to strengthen our approach, both in terms of how we manage projects as a whole and how we develop better, more beneficial relationships with the supply chain”.

Today’s report comes a week after Japan’s Hitachi announced it was to buy the Horizon project to build new nuclear plants in the UK. Horizon forms a key part of the UK government’s plans to kickstart a nuclear new build programme, with the other key participant being a consortium of EDF and Centrica.

Horizon was formed by German companies E.ON and RWE but both pulled out earlier this year, citing financial constraints caused by the Merkel government’s plan to withdraw from nuclear power in Germany.