Flexible economic appraisal tool for the river basin management plan national economic appraisal

The WFD Regulations (2017) and associated Ministerial Guidance require the Environment Agency to present to the Secretary of State an economic analysis of the costs and benefits of the programmes of measures outlined in the river basin management plans (RBMPs) prior to their approval. This economic analysis informs decision on the level of investment and outcomes expected as a result of the RBMPs and also assesses present value over the long-term. This work was last completed in 2015 as an Impact Assessment https://www.gov.uk/government/publications/update-to-the-river-basin-management-plans-impact-assessment. Defra have confirmed that an Impact Assessment format is not necessary now, however the need for an economic analysis of the RBMPs remains.

The outline appraisal methodology is described in the Green Book (HM Treasury 2020) https://www.gov.uk/government/publications/the-green-book-appraisal-and-evaluation-in-central-governent. However the tools and majority of parameters for conducting this assessment are not standardised and may vary. We need a flexible economic appraisal tool to be developed to be able do this quickly and easily. Chapters 5 and of the Green Book covers the parameters and possible adjustments that will need to feature in the assessment. We would like to hear suggestions from you in your application as to ways that distributional analysis might be built in to the RBMP national economic assessment and the appraisal tool, given the scale and complexity of the programme. To achieve maximum value for money, the intention is to design a tool that will be of primary use for this project, but that will also be flexible enough to act as an economic analysis template for future strategic long term investment scenario planning across the Environment Agency. In addition to monetised data the tool must have a section where users can include appraisal details, including project/programme name and SMART objectives, and compare options.

A well-designed spreadsheet may be suitable, but we are open to other solutions providing they are compatible with our systems. Deliverables:

1. A Green Book compatible multi-purpose appraisal tool that is flexible enough to cope with changing parameters, including different appraisal horizons, discount rates, optimism bias, distributional impacts and sensitivity tests, and that can be used to combine multiple sources and formats of cost and benefit data. Include user instructions as part of the tool.
2. A populated copy of the appraisal tool, completed with economic data gathered for the purpose of the RBMP National Economic Assessment.
3. An agreed set of draft summary tables and headline figures from this data.
4. Training for the Environment Agency Project Manager on the design and use of the appraisal tool.

Additional information: You are invited to quote for the above in accordance with the enclosed documents. Instructions on what information we require you to provide is in Section 4 of the Request for Quotation document. Your response should be returned by email to the following email address vicki.betts@environment-agency.gov.uk by 14:00, 9 February 2021. Please email any questions to this address for a prompt response.