Recommendation 5

Environmental impacts are still not being taken into account in spending decisions. For the last Spending Review, the Treasury asked departments to set out how their proposals would contribute towards the UK’s statutory carbon targets, and to explain their impact on, and coherence with, the 25 Year Plan. However, departments struggled to do this. As part of updating its Green Book guidance on evaluating projects, the Treasury has made changes to better prioritise the environment, and it has commissioned further work to understand the economic implications of environmental issues. But it recognises it has more to do to make sure it has the right structures and guidance to ensure environmental impacts are properly factored into the next spending review. Recommendation: Alongside the next Comprehensive Spending Review, the Treasury should publish analysis showing: how the full value of environmental impacts has been taken into account, and the impact of spending decisions on meeting government’s long-term environmental goals.