ACE backs Burnham's Green Book shake-up ahead of Budget detail

The Association for Consultancy and Engineering (ACE) has welcomed Prime Minister Andy Burnham's announcement of further reform to HM Treasury's Green Book appraisal rules, with full detail expected at the Budget next week.

The Government said the Prime Minister set out plans on 22 October 2026 to deliver a package of Green Book reforms at the Budget. The changes were announced alongside a meeting between the Prime Minister and English mayors at No10 North.

ACE said the proposed approach will help local and strategic authorities develop place-based business cases, consider related investments together and identify barriers to local growth.

Marie-Claude Hemming, Policy Director at ACE, said: "The direction of travel reflects important ACE asks, and Green Book reform must help turn local ambition into investment that delivers growth."

What the Government has proposed

According to the Government, a housing scheme and a transport proposal are at present considered independently of each other under the Green Book. It said considering projects together gives a fuller picture of their potential, which is often missed or undervalued when schemes are assessed separately.

The Government said No10 North will help local areas, including places not currently represented by mayors, to engage with the new process and draft business cases.

It added that the Budget will include a roadmap for future fiscal devolution, giving regional leaders control over how they allocate a share of some national taxes.

Chancellor John Healey MP said: "This change gives regional leaders a stronger voice in where investment can make the biggest difference in their communities."

Eamon O'Brien, Chair of the Local Government Association, said councils know their places best and are uniquely positioned to bring together investment in housing, transport, skills and public services.

The discount rate

The Government said the further reforms would build on changes announced by the Chancellor the previous month, including cutting the headline discount rate from 3.5% to 3%.

In its notes to editors, ACE referred to the previously announced intention to reduce the rate. The trade body said the published Green Book currently retains the 3.5% rate for the first 30 years of appraisal, and that implementation details should be confirmed in the forthcoming Budget documents.

The rate has been under review since December 2025, when HM Treasury commissioned Professor Ben Groom and Professor Mark Freeman to lead an independent review of the Green Book's approach to discounting. According to HM Treasury's Green Book Review 2025: one year on report, the review recommended amending the headline discount rate from 3.5% to 3.0%. The Social Time Preference Rate under review was set at 3.5% for the first 30 years of a proposal.

HM Treasury said a lower discount rate would typically mean the benefits of long-term schemes are valued more highly.

ACE's position on delivery

ACE said better appraisal must be matched by better project development, with robust evidence and the right expertise needed to turn investment plans into deliverable projects.

Hemming said: "Early engagement with engineering and environmental consultancies can help clients assess options, manage risk and secure better whole-life value from public investment."

ACE says its members employ over 60,000 people in the UK and 250,000 worldwide, contributing more than £15bn to the UK economy. Its sister organisation is the Environmental Industries Commission.

Background

The announcement is the latest step in a reform process ACE has tracked for more than a year. In June 2025, Kate Jennings, Chief Executive of ACE Group, called for the Green Book to recognise that investment unlocks potential, in the group's response to the 2025 Spending Review.

HM Treasury published a revamped Green Book on 5 February 2026, launched by Rachel Reeves as Chancellor of the Exchequer, saying it would give overlooked regions a fair hearing in spending decisions. ACE welcomed it the same day, with Ben Brittain, its Director of Public Affairs, describing it as exactly the direction of travel ACE had been calling for.

HM Treasury said the Chancellor had announced in October 2025 that Liverpool, Plymouth, Port Talbot and Birmingham would be the first four locations to trial place-based business cases. In its one year on report it said the east Birmingham case is examining co-ordinated investment in health, housing and skills, and that place-based business cases will make sure the government properly assesses complementarities between projects such as housing and transport.

What happens next

HM Treasury said in the same report that it would take lessons from the four early adopter locations and publish new guidance on place-based business cases in the autumn.

Both ACE and the Government point to next week's Budget for the detail of the further reforms and, in ACE's words, confirmation of how the discount rate change will be implemented.