Herbert Smith has reaped around £5m in legal fees for its first 12 months of advising the Department of Trade and Industry (DTI) on the £48bn nuclear clean-up programme.
The City firm scooped a two-year contract to advise the DTI on the commercial aspects relating to the creation of the Nuclear Decommissioning Authority (NDA) after pitching against a number of rivals in September 2003.
As first revealed in The Lawyer (8 September 2003), Slaughter and May, which was until last year the Govern-ment’s principal adviser on nuclear issues, was not invited to pitch for the NDA mandate.
Slaughters was excluded from the tender process because it was already advising the Government on the high-profile British Energy restructuring. The DTI was concerned about over-dependence on a single firm.
A well-placed source said that Herbert Smith’s fees were stacking up at a much faster rate than Slaughters’ bills on the two-and-a-half years worth of work on British Energy.
“£5m is a hell of a lot of money for a year’s worth of work, especially as there’s no result at the end of it,” said the source.
It was revealed last week that the fees payable to the DTI’s advisers on the British Energy restructuring, including Credit Suisse First Boston, Deloitte & Touche and Slaughters, total £13.5m.
Meanwhile, in the same week the European Commission (EC) confirmed that it was going to launch a formal investigation into whether the Government’s plans to give state aid to the NDA breached EC rules.