Source · Select Committees · Public Accounts Committee
Recommendation 17
17
We asked the Treasury what it was doing to ensure departments factor the environment into...
Conclusion
We asked the Treasury what it was doing to ensure departments factor the environment into their spending bids. Treasury told us that for the 2020 Spending Review it asked departments for an assessment of the contribution of their proposals towards delivering the UK’s statutory climate objectives in terms of emissions; and asked them in looser language to talk about the impact and coherence of their bids with the environment plan.45 Ahead of the spending review, Treasury updated guidance on assessing and valuing effects on the natural environment in the Green Book.46 It told us it also has an academic review on discounting underway, a key issue being whether the public value discount rate is an appropriate discounting rate for natural capital, given the associated health benefits.47
Government Response
Not Addressed
HM Government
Not Addressed
The government agrees with the Committee’s recommendation. Target implementation date: April 2022 5.2 HM Treasury recognises its important role in supporting the delivery of the government’s climate and environmental objectives. Both the Stern and the Dasgupta Reviews, on the economics of climate change and biodiversity respectively, were commissioned by the Treasury. Its Net Zero Review will also be published later in 2021. 5.3 At spending reviews, departments are required to assess the costs and benefits of their proposals – including climate and environmental impacts – following the framework set out in the Green Book. Treasury spending teams consider these impacts when assessing the strategic importance and value for money of any proposal. 5.4 HM Treasury continuously improves the Green Book in line with the latest scientific evidence. In 2018, the Green Book and its supplementary guidance were revised with support from the Natural Capital Committee to require more comprehensive appraisal of environmental impacts following a natural capital approach. Resources such as Defra’s Enabling a Natural Capital Approach (ENCA) make data, guidance and tools available to support policymakers. The Treasury is also currently conducting an expert-led review of the environmental discount rate. 5.5 Spending Review 2020 guidance required departments to include the greenhouse gas emissions of bids, and their impact on meeting Carbon Budgets and Net Zero. Guidance also sought qualitative commentary on the impact of delivery of the 25 Year Environment Plan. HM Treasury is currently reviewing the learning from this exercise and considering what additional information should be published following the next spending review to support public understanding of the role the Treasury plays in meeting government’s environmental objectives.