ICE policy position statement: Reforming the Green Book to achieve better outcomes from infrastructure investment

In October, ICE published a discussion paper to ask our members and other stakeholders their views around Green Book reform.

This policy position draws on the evidence received to make recommendations on Green Book reform around the areas of application, reflecting strategic national objectives, improving local capability and better incorporating net zero into project appraisal and evaluation. This policy position has also incorporated the views and ongoing work of The Carbon Project, an ICE-led industry-wide response that brings together leaders and experts across the infrastructure sector to tackle the challenges that are slowing progress towards net-zero.

In overview, ICE believes that the Green Book itself provides the correct tools to address strategic national objectives, but requires better application, as well as guidance and clarity on the detailed policy context that it operates in from the government.

Recommendations:

1. Focus on improving the application of the existing appraisal model, not revolutionary change: Reform of the Green Book should relate to improving the application of the Five Case Model rather than drastically changing the appraisal process and practice. ICE has previously called for a standardised scorecard to be developed to prioritise, identify and weight non-financial outcomes for major projects. We would welcome such an approach in the Green Book project appraisal.
2. Government departments can use the Green Book best when targeted outcomes are clear – clarity is needed on the hard targets that sit behind national objectives: In order for strategic objectives to be better addressed through the Green Book, additional clarity and detail are required from the government on specific interim targets towards net zero, both over time and at a spatial level, alongside a definition of ‘levelling up’ and its specific goals.
3. Regional investment should be judged on both national and regional priorities – reform should strengthen the capability for developing subnational evidence bases: It is important for the Green Book’s strategic narrative to align with specific regional requirements and not rely on a single set of national objectives. This can allow for balanced decisions and trade-offs to be made regionally, including on social value. We suggest that this is backed up with greater devolution of decision-making and funding regarding infrastructure in order to improve capability and pace, encouraging more developed evidence bases at regional levels.
4. Achieving the net-zero target to avert a climate emergency is vital and should be the bright green thread woven through any refresh of the Green Book: ICE believes net zero should be appraised through the existing Five Case Model, providing the net-zero target is explicitly and clearly stated as a key objective and subsequently reinforced in the methodologies and guidance in the Five Case Model. In this way, net-zero thinking is woven as a bright green thread throughout each of the case models, rather than as a separate model entirely.