Two independent think-tanks, the New Local Government Network and the New Policy Institute, are calling on the Treasury to make further amendments to a new draft of its ‘Green Book’ – the central government “bible” setting out the basic principles on investment appraisals for the allocation of public spending.
In their joint submission, made public this week, NLGN and NPI view the new Green Book as:
- signalling a desire for more public sector investment;
- allowing more variation on the method of assessment at local and service area level;
- promoting the importance of distributional issues by providing a means by which they can be handled and represented within a quantitative framework.
The two think-tanks add, however, that to raise the quality of investment appraisal, the Government must go further, and
- treat the new publication as the start of an ongoing process through which to raise standards of appraisal and evaluation
- clarify which agencies and public and private bodies should treat the Green Book as an important source of guidance for their own investment and resource decisions;
- clarify who ultimately determines the overall discount rate to be used, the relevance of distributional issues and weights to a particular project and the way benefits should be valued.
With reference to their joint response to the Green Book consultation, Dan Corry and Peter Kenway, executive directors of NLGN and NPI respectively, state:
“The importance of the Green Book goes far beyond the few people that will ever read the original. It sets a tone and a benchmark for what is and what isn’t acceptable in investment appraisals done in every sector. As ‘new localism’ takes hold, it is vital that local decision makers, including local authorities, take appraisal seriously and do so in ways relevant to the problems they are trying to solve. Where PPPs are involved this becomes even more important”.
NLGN media enquiries to Ian Parker – 020 7357 0116
NPI enquiries to Peter Kenway – 020 7721 8421
The New Local Government Network is an independent think-tank, seeking to transform public services, revitalise local political leadership and empower local communities.
The New Policy Institute is a progressive think-tank, founded in 1996. Its mission is to advance social justice in a market economy. www.npi.org.uk
Dan Corry was formerly an economist at HM Treasury. Peter Kenway was previously an academic economist and an economist at London Transport.