Do DfT want 100 years of time savings in appraisal?

Despite the focus on responding to the Green Book Review, DfT started a consultation over the Christmas period on the length of time appraisals should take and the discount rates which should be used.  TPS made it clear in its submission that it should be seen in the context of the significant criticisms and urgent reforms which must follow the Green Book Review.  It was wrong to make adjustments aimed at increasing the BCR of schemes when this whole concept had been so strongly criticised and was subject to a current and fundamental review.

The TPS response is in two parts: a discussion of the key issues, and a detailed response to the DfT’s 11 specific questions in the consultation.

TPS set out its objectives in the response as follows:

• To address the way in which many future impacts are undervalued – although the ones listed in the consultation did not represent the main problem areas.
• To address uncertainty in appraisal and how it varies widely between impacts: this would be an issue in any circumstances but is particularly important given the changes which are flowing from Covid 19.
• To contribute to the reforms identified in the Green Book Review, especially to reflect policies for net zero and levelling up: the latter also needs urgent work to provide a better analytical framework and should be a priority.
• To reform the current system so that appraisal identifies schemes which achieve objectives rather than, as at present, over value schemes which don’t.

TPS suggests a range of solutions in response to this consultation, including:

• an end to the over discounting of environmental impacts and the under discounting of many time values,
• using a range of time periods to reflect this,
• not proceeding with creating larger and even more uncertain BCRs with up to 100 years of non-existent and unmodelled benefits.

It also recommends the revival of the Assessment Summary Table in light of these and other reforms which are part of the joint initiative with LGTAG, CIHT, and RTPI and reported on previously.  Active discussions are continuing with DfT and Treasury.

The full TPS response can be found here  DfT appraisal period response.pdf

The DfT original consultation document can be found on https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/948251/appraisal-periods-consultation.pdf