The Act Part 1: the Civil Nuclear Industry.Summary and Background Authorisation of Government expenditure
29.As part of the restructuring of British Energy (“BE”), the Government has agreed to enter into a series of principal agreements with the company. The agreements detail the arrangements by which British Energy and HMG will contribute to the costs of discharging BE’s nuclear liabilities going forward.
30.The Secretary of State intends to give effect to most of his obligations under the agreements using his powers under Schedule 12 to the Electricity Act 1989, as amended by the Electricity (Miscellaneous Provisions) Act 2003 (c.9) (“EMPA”), and as to be amended by section 34 of the Act. He will also have available additional, free-standing powers conferred by EMPA.
31.Section 79 gives the Secretary of State explicit statutory authority to incur expenditure as a result of options included in the documents. The provision is general, but goes further than the free-standing provisions in EMPA by authorising spending on two elements of the agreements not currently covered by legislation:
	in circumstances where British Energy has sold one of its nuclear power stations to a third party, the acquisition of the power station from that third party and subsequently operating it. This would follow the exercise of an option on the part of HMG to acquire the station for this purpose; and
	the acquisition of British Energy’s shareholding in Nirex, and to incur expenditure on any consequences of such an acquisition.
32.As a matter of law, the Appropriation Acts give the Secretary of State the authority to spend money on the exercise of his functions, but as a matter of practice, the agreement with Parliament known as the Baldwin agreement and the guidance set out by the Treasury in Government Accounting have the effect that new functions involving significant and continuing expenditure should normally be identified by an Act other than the Appropriation Act.