Supplementary guidance

The Green Book sets out the core principles. Supplementary guidance to the Green Book on particular aspects of investment appraisal can be accessed below.

Adaptation to Climate Change
Managing risks
Intergenerational wealth transfers and social discounting
Optimism bias
Taxation, PFI, and the Public Sector Comparator
Sustainability and Value for Money - a quick guide
Value for money and the valuation of public sector assets
Market effects of subsidies
Impact Assessments (IA)
Third Sector: funding relationships
OGC Gateway

Please note that many of the links below are to external websites and will open in a new window. Some of the documents below are available in Adobe Acrobat Portable Document Format (PDF). If you do not have Adobe Acrobat installed on your computer you can download the software free of charge from the Adobe website. For alternative ways to read PDF documents and further information on website accessibility visit the HM Treasury accessibility page.

Adaptation to Climate Change

Accounting for the Effects of Climate Change (PDF 589KB) (Defra website, opens in new window)
Supplementary Guidance to the Green Book
Summary and Issues Filter (PDF 109KB) (Defra website, opens in new window)
Adapting to Climate Change (Defra website, opens in new window) Adapting to Climate Change Programme website

Managing risks

Managing risks to the public: appraisal guidance

Managing risks to the public: appraisal guidance
Designed to help policy makers address certain risks that the public faces, and also its perceptions of risk. June 2005

Principles of managing risks to the public

Principles of managing risks to the public
One page guide issued by HMT and Cabinet Office
The Orange Book Management of Risk - Principles and Concepts

Provides broad based general guidance on the principles of risk management, enhanced to reflect lessons learnt HMT October 2004
Management of Risk (OGC website)

Office of Government Commerce detailed guidance on the practical application of the principles and concepts of the Orange Book

Intergenerational wealth transfers and social discounting

Intergenerational wealth transfers and social discounting (PDF 205KB)
New Green Book guidance produced in the light of the Stern Review on climate change which specifies the discounting treatment of projects with very large long term effects on the welfare of future generations

Optimism bias (OB)

Green Book guidance

Green Book guidance (PDF 100KB)
Describes methodology for applying OB, and provides adjustment factors for generic project categories

OB in transport planning

OB in transport planning (PDF 466KB)
Provides OB up-lifts for certain types of transport infrastructure projects; and guidance on using them; and discusses the underlying causes and institutional context for OB in transport projects and how to reduce it
Summary (DfT website)
OB adjustments for regeneration, decent homes, and fire projects (Communities and Local Government website)
(Guidance and research reports in these three areas, including PFI projects

Mott Macdonald report: Review of Large Public Procurement in the UK

Mott Macdonald report: Review of Large Public Procurement in the UK (PDF 340KB)
Study of large public procurement projects in the UK, deriving OB uplift factors - July 2002

Taxation, PFI, and the Public Sector Comparator

Guidance

Supplementary guidance on the taxation of PFI, and the Public Sector Comparator (PDF 46KB)
Recommended approach for estimating the differential tax receipts from the use of the Private Finance Initiative (PFI), compared to traditional public sector procurement, to correct any potential bias.

KPMG Report

KPMG Report (PDF 181KB)
KPMG Report on identifying and measuring the differential tax receipts from Private Finance Initiative schemes for the purpose of economic evaluation against a Public Sector Comparator - July 2002

Sustainability and Value for Money - a quick guide

Sustainability and value for money - a quick guide
A short and straightforward outline about value for money when buying goods and services, for non-economists and non-finance professionals responsible for managing procurement projects

Value for money and the valuation of public sector assets

Value for money and the valuation of public sector assets (PDF 181KB)
Guidance concerned with application of basic Green Book principles to the valuation of existing assets. Produced in the light of issues arising when considering the value of certain public sector corporate and financial assets for possible sale.

Market effects of subsidies

Market effects of subsidies (PDF) (OFT website)
Guidance to assess whether a proposed subsidy is likely to have a significant effect on competition and, if so, to incorporate this into the wider appraisal HMT/OFT 2007

Impact Assessments (IA)

Accompanies the competition assessment part of the IA process, and contains useful information on assessing the costs and benefits to competition of a range of policy designs. (Currently in draft form pending completion of consultation.)

Third Sector: funding relationships

Third Sector: funding relationships

Guidance for distributing public money to the third sector, addressing: stability in the funding relationship (moving from one year to longer-term funding); timing of payments and balance of risk (payment in arrears); full cost recovery; and reducing the burden of bureaucracy.

OGC Gateway

OGC Gateway (OGC website)

Detailed guidance on project management

Supplementary guidance

Related links