FCERM grant-in-aid: discount rates and price indices
Updated 1 April 2026
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This guidance is for FCERM project teams who need to apply for government flood defence grant-in-aid (FDGIA) for projects or strategies.
This guidance explains how to apply the following consistently:
- the discount rates defined in the Treasury Green Book (published 2018)
- price indices
Risk management authorities (RMA) in England may find this information useful for developing plans and making flood and coastal erosion risk management (FCERM) investment decisions.
1. Transitional arrangements
When working with this guidance, you should follow the arrangements for Transitioning to the 2020 flood and coastal erosion resilience partnership funding policy.
2. Discount rates
The 2018 Treasury Green Book has the standard discount rate of 3.5%, and introduces a new discount rate for ‘risk to health and life’. The new rate starts at 1.5%.
For the purposes of FCERM projects, you should only apply this lower discount rate to:
- risk to life valuations
- mental health valuations
- human-related intangible costs to stress and health
- emergency services
The Green Book Supplementary Guidance Discount Factors spreadsheet contains the discount rates and the discount factors for each year. Paste these into existing economic appraisal spreadsheets. Check you’ve applied the appropriate discount rate to the correct element of the appraisal.
| Discount rates | Years 0-30 | Years 31-75 | Years 75-125 | Discount factor years 0-99 |
|---|---|---|---|---|
| Standard discount rate | 3.5% | 3.0% | 2.5% | 29.813 |
| Health discount rate | 1.5% | 1.286% | 1.071% | 54.356 |
3. Price indices
The 2018 Green Book recommends using the GDP deflator to update price-dated values to a current price date. Apply this as default to all elements of the economic benefit appraisal where you must update source data to a current price date.