UK Offset and the Green Book
The UK Offset Policy says the new Offset Authority will value Offset projects in a way that is consistent with HM Treasury's Green Book. Its valuation guidance is still to come. Until then, this page explains what the Green Book is and puts its principles into the terms Offset managers already use.
What the Green Book is
The Green Book is HM Treasury's guidance on appraisal: how the UK government weighs the costs, benefits and risks of different ways of meeting its objectives. Government departments must follow it when they plan significant spending. The current edition was published in February 2026.
It asks one question of every proposal: how much better off is the UK as a whole, compared with what would have happened anyway?
Why it matters for Offset
Section 3.11.1 of the policy says the Offset Authority will use “a transparent value framework that is consistent with the HMT Green Book principles” to set the credit for each approved project. Credit is based on UK value added: the value “genuinely generated in the UK”.
So the face value of a contract, an investment or a licence is the starting point, not the credit. Multipliers then add extra credit for priority places, activities and sectors. Their values are still to be published.
The Green Book in Offset terms
Each line pairs a familiar Offset term with the Green Book idea behind it.
- AdditionalityGreen Book: additionality. Credit only for value that would not exist without the Offset obligation.
- IncrementalityGreen Book: deadweight. Business that would have happened anyway, such as existing contracts and routine re-orders, earns nothing.
- BaselineGreen Book: business as usual. The starting position that new business is measured against.
- CausalityGreen Book: outcomes that happen as a result of the intervention. The supplier must show that its obligation caused the work.
- UK contentGreen Book: leakage. Only value made in the UK counts; imported content is deducted.
- No re-badgingGreen Book: displacement and substitution. Moving work between UK firms, or relabelling existing work, adds nothing.
- SustainabilityGreen Book: durability and discounting. Capability that lasts for years counts for more than one-off work.
- Credit on deliveryGreen Book: optimism bias. Credit is for what is delivered and checked, not what is promised.
- Activity, not paymentsGreen Book: transfers. A payment on its own is not value; credit follows the UK activity it pays for.
- Capability buildingGreen Book: supply-side benefits. Credit follows lasting gains in skills, technology and productivity, not turnover.
- Regional and SME multipliersGreen Book: place-based and distributional analysis. Benefits in less productive regions and in smaller firms carry extra weight.
- Strategic fitGreen Book: the strategic case. Projects should serve the published priority areas.
- VerificationGreen Book: monitoring and evaluation. Evidence of delivery is checked before credit is granted.
What this means in practice
- Real UK makers with high UK content count for more than distributors and importers.
- New capability, such as technology transfer, research and skills, counts for more than more of the same.
- New work for established UK companies on what they already make still counts as UK value, even where it attracts no multiplier.
- Plan the evidence from day one: the starting position, the UK content, new jobs and who fills them, approvals and exports.
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