Green Book supplementary guidance: discounting
Supplementary guidance to the Green Book on social discounting.
Documents
Details
The Green Book recommends that appraisal practitioners use discounting to express future social costs and social benefits in terms of their present value.
The first document sets out supplementary guidance on discounting. This includes the derivation of the social time preference rate (STPR), as well as the reduced discount factors for proposals that have social costs and social benefits over a period exceeding 50 years.
The second document, published in 2018, summarises the key theoretical and empirical evidence on social discounting that has emerged since 2003.
The third document sets out the conclusions of a 2021 review into how discounting is applied to environmental costs and benefits.
Updates to this page
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The guidance has been expanded to cover the previously disparate guidance on discounting in the Green Book. This includes greater detail on the formulation of the discount rate and tables outlining health discount factors and reduced long-term discount factors.
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New link to the Green Book and its collection of accompanying guidance and materials collection page to improve signposting.
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First published.