Value for Money

Achieving net zero

Published 4 December 2020 24 recommendations Cabinet Office, Department for Business, Energy & Industrial Strategy, Department for Environment, Food & Rural Affairs, HM Treasury Climate change and net zeroEnergy and environment nao.org.uk

This report applies experience from auditing cross-government challenges to highlight the risks government needs to manage to achieve net zero.

Recommendations (24)

Source: NAO Recommendations Tracker · PAC follow-up below

Accepted

Partially Accepted

Implemented

NAO Confirmed

Department for Energy Security and Net Zero

Rec 1 Accepted Implemented

BEIS, working with HM Treasury, Cabinet Office and the other departments with responsibility for aspects of net zero should: • set out how it will manage the risks we have identified in this report (paragraphs 2.11 to 2.18) to creating collective responsibility for net zero; and

Page 8, paragraph 10, first bullet point Q3 2021-22 Cabinet Office; Department for Environment, Food and Rural Affairs; Department for Transport; HM Treasury; Ministry of Housing Communities and Local Government

Department for Energy Security and Net Zero

Rec 10 Accepted Implemented

Cabinet Office and HM Treasury, working with BEIS, should: • ensure that existing and planned arrangements to help departments reduce their own greenhouse gas emissions align with achieving net zero. In particular, ensure that the new Greening Government Commitment targets, due for release in April 2021, are sufficiently ambitious to set an example to businesses in the UK; and

Page 10, paragraph 12, first bullet point Q2 2023-24 Cabinet Office; HM Treasury

Department for Energy Security and Net Zero

Rec 11 Partially Accepted Implemented

• ensure that similarly ambitious targets extend to all significant sources of emissions from the public sector, including schools and the NHS.

Page 10, paragraph 12, second bullet point Q2 2023-24 Cabinet Office; HM Treasury

Department for Energy Security and Net Zero

Rec 12 Accepted No Longer Relevant

BEIS should: • prepare contingency plans that consider how to provide greater certainty and transparency around its net zero plans even if a full strategy is not possible prior to COP26 given the ongoing uncertainty around the impact of COVID-19.

Page 11, paragraph 13, first bullet point

Department for Energy Security and Net Zero

Rec 13 Accepted Implemented

BEIS should: • identify and evaluate the elements of the net zero strategy which are uncertain and develop a plan to reduce this over time, including assigning responsibilities for managing reduction in uncertainty (such as by carrying out sufficient research or piloting); and

Page 12, paragraph 14, first bullet point Q3 2021-22

Department for Energy Security and Net Zero

Rec 14 Accepted Implemented

• set out its timetable for when key decisions in the pathway to net zero will need to be taken.

Page 12, paragraph 14, second bullet point Q3 2021-22

Department for Energy Security and Net Zero

Rec 15 Accepted Implemented

BEIS should: • ensure that the main interdependencies within the achievement of net zero are understood by the relevant departments involved;

Page 12, paragraph 15, first bullet point Q3 2021-22

Department for Energy Security and Net Zero

Rec 16 Accepted Implemented

• ensure the net zero strategy takes account of the main interdependencies between different work streams; and

Page 12, paragraph 15, second bullet point Q3 2021-22

Department for Energy Security and Net Zero

Rec 17 Accepted Implemented

• set out its plan for managing interdependencies in the future, including who is responsible for managing each interdependency and how it will review progress on a regular basis.

Page 12, paragraph 15, third bullet point Q3 2021-22

Department for Energy Security and Net Zero

Rec 18 Accepted Implemented

All departments with lead responsibility for decarbonising sectors (BEIS, Defra, DfT and MHCLG) should: • work on widening government’s understanding of links between achieving net zero and other government aims, such as for clean air and ‘levelling up’; and

Page 13, paragraph 15, fourth bullet point Q4 2022-23 Department for Environment, Food and Rural Affairs; Department for Transport; Ministry of Housing Communities and Local Government

Department for Energy Security and Net Zero

Rec 19 Accepted Implemented

• use this understanding to establish how trade-offs between net zero and other aims will be managed, including the prioritisation of resources

Page 13, paragraph 15, fifth bullet point Q4 2022-23 Department for Environment, Food and Rural Affairs; Department for Transport; Ministry of Housing Communities and Local Government

Department for Energy Security and Net Zero

Rec 2 Accepted Implemented

• establish regular review points, starting with a review by the end of 2021, to consider the effectiveness of the arrangements, including those established within departments such as carbon boards, and whether changes are required.

Page 8, paragraph 10, second bullet point Q4 2021-22 Cabinet Office; Department for Environment, Food and Rural Affairs; Department for Transport; HM Treasury; Ministry of Housing Communities and Local Government

Department for Energy Security and Net Zero

Rec 20 Accepted Implemented

BEIS, Cabinet Office and HM Treasury should: • develop and monitor a set of clear, relevant and consistent data on the progress of net zero policies across government along with a process for escalating issues when the data show policies are off track.

Page 13, paragraph 16, first bullet point Q3 2021-22 Cabinet Office; HM Treasury

Department for Energy Security and Net Zero

Rec 21 Accepted Implemented

BEIS and HM Treasury should: • collate information on how much government is spending to achieve net zero overall, including how much it has committed and how much it has actually spent. This should include the costs of policies that go through consumers’ bills.

Page 14, paragraph 17, first bullet point Q4 2023-24 HM Treasury

Department for Energy Security and Net Zero

Rec 22 Partially Accepted Implemented

BEIS, with input from other departments, should: • establish a public engagement strategy that sets out how government will ensure ongoing buy-in to the changes required by the transition to net zero. This should include consideration of how it will tailor its messages for audiences with different characteristics, including ethnic minorities; age groups; geographical locations; and income levels; and

Page 14, paragraph 18, first bullet point Q3 2021-22

Department for Energy Security and Net Zero

Rec 23 Accepted Implemented

• ensure it has data that enable it to monitor the cumulative social and economic impact on different individuals and communities of the transition to net zero so that government can consider whether to change course if it deems the burden is falling overly onto specific groups.

Page 14, paragraph 18, second bullet point Q4 2023-24

Department for Energy Security and Net Zero

Rec 24 Accepted Implemented

BEIS and HM Treasury should: • establish progress measures and monitoring arrangements that enable them to track whether they are achieving the required investment from the private sector.

Page 15, paragraph 19, first bullet point Q3 2024-25 HM Treasury

Cabinet Office

Rec 3 Accepted Implemented

Cabinet Office should: • ensure the next iteration of Single Departmental Plans creates a cross-government plan for achieving net zero; and

Page 9, paragraph 10, third bullet point Q2 2021-22

Cabinet Office

Rec 4 Accepted Implemented

• utilise its programme of work aimed at modernising and reforming the civil service to increase the visibility of net zero within the civil service and develop key skills, such as in climate science, data analysis and systems thinking, that will be necessary to achieve net zero.

Page 9, paragraph 10, fourth bullet point Q1 2022-23

HM Treasury

Rec 5 Accepted Implemented

HM Treasury should: • publish analysis shortly after the next Comprehensive Spending Review, which will allocate high-level budgets to departments in the medium term, demonstrating its impact on expected emissions; and

Page 9, paragraph 10, fifth bullet point Q3 2022-23

HM Treasury

Rec 6 Accepted Implemented

• ensure its guidance that informs public spending decisions, such as on policy appraisal (the Green Book) and guidance for accounting officers, requires departments to evaluate the impact of policies on the achievement of the net zero target, and is consistently adhered to.

Page 9, paragraph 10, sixth bullet point Q4 2022-23

Department for Energy Security and Net Zero

Rec 7 Accepted No Longer Relevant

BEIS and MHCLG should: • ensure that local authorities’ perspectives are incorporated into the formation of sector strategies and the overall net zero strategy; and

Page 9, paragraph 11, first bullet point Ministry of Housing Communities and Local Government

Department for Energy Security and Net Zero

Rec 8 Partially Accepted Implemented

• ensure local authorities have the skills and capacity to mobilise the action that is required locally across all sectors.

Page 9, paragraph 11, second bullet point Q2 2023-24 Ministry of Housing Communities and Local Government

Department for Energy Security and Net Zero

Rec 9 Partially Accepted Implemented

BEIS, working with other government departments, should: • consider how to extend its coordination arrangements beyond central government departments to include the perspectives of other public bodies.

Page 10, paragraph 11, third bullet point Q2 2023/24

Parliamentary Committee Follow-Up

The Public Accounts Committee examined this NAO report and published its own recommendations. The government responds to PAC recommendations via Treasury Minutes.