The National Audit Office (NAO) also said that for 50 years, the operators of the Cumbria installation failed to develop a long-term plan for waste.
Costs of plant-decommissioning has also spiralled out of control, it said.
Operator Sellafield Ltd, said it welcomed the report’s findings and was “making improvements”.
The plant is the UK’s largest and most hazardous nuclear site, storing enough high and intermediate level radioactive waste to fill 27 Olympic-sized swimming pools.
The NAO report states however, that owners of the station do not know how long it will take to build storage and treatment centres for the hazardous material or how much the final bill for decommissioning the plant is likely to be.