1. Introduction

This section describes what appraisal is, what the FCERM appraisal guidance is for, who should use it and how its structured.

What appraisal is

Appraisal is the process of assessing the costs, benefits and risks of alternative ways to meet government objectives. It helps you to understand the potential effects, trade-offs and overall impact of options by providing an objective evidence base for decision making.

What the appraisal guidance is for

The Environment Agency and all other risk management authorities (RMAs) must carry out an appraisal when developing or reviewing:

  • a business case to support an application for FCERM capital funding
  • a local FCERM strategy

RMAs should also use the appraisal guidance proportionately as they develop FCERM project proposals to include in the FCERM capital programme. Using it will help you set realistic ambitions for your project and more quickly lead you and your project partners to a successful outcome.

2022 guidance update

The appraisal guidance was originally published in 2010. The projects developed using it have contributed significantly to the FCERM capital programme. This includes better protecting more than 300,000 households from flooding or coastal erosion.

The guidance is based on the HM Treasury Green Book and the Defra policy statement on appraisal of flood and coastal erosion risk management. In future it will play a critical role in achieving the aims set out in the National Flood and Coastal Erosion Risk Management Strategy for England and the Defra Policy Statement on FCERM published in 2020.

Following user feedback, we’ve updated the appraisal guidance to make it clearer, more concise, and more accessible. The updated appraisal guidance follows the government’s partnership funding policy which sets out how RMAs can access FCERM grant-in-aid (GIA) funding for projects.

Key changes

The changes include:

  • clarifying what you need to do for different types of projects to reduce the time, cost and complexity of appraisal
  • encouraging you to work with partners from the outset to set clear project objectives and to develop strong funding partnerships
  • clearer guidance on creating objectives which balance a range of broader outcomes – including carbon reductions and sustainability
  • using the latest climate change scenarios to develop options that better plan and adapt to a changing climate
  • simplifying the process for selecting options that achieve national FCERM investment priorities whilst balancing local choices
  • wider use of nature-based solutions to manage the flow of water and that work with natural coastal processes

We will regularly update the appraisal guidance in future. This allows us to support the ambitions of the National FCERM Strategy and be agile to government policy priorities.

When to use the new guidance

You can choose to use the new guidance on your FCERM project at any time.

You must use:

  • the new guidance for all strategic outline cases submitted for assurance after 1 October 2022
  • the new guidance for all outline and full business cases submitted after 1 April 2023
  • the same appraisal guidance you used for your full business case if you are doing a business case update report

If you have any concerns about applying the new arrangements to your project you should email [email protected]

Using the appraisal guidance

The appraisal guidance consists of 2 parts:

  • this manual, which explains the appraisal steps at a high level
  • the technical guidance, which explains the specific appraisal techniques, analysis and evaluations you need to develop a successful business case

There is also supplementary guidance which can help you with certain aspects of your appraisal. The technical guidance explains when you need to use this.

Who the guidance is for

This appraisal guidance is for:

  • RMAs in England
  • anyone carrying out an FCERM appraisal
  • anyone reviewing an FCERM appraisal
  • stakeholders in an FCERM project
  • members of the public affected by flooding or erosion

Provide feedback

If you have feedback on this appraisal guidance, email [email protected]