BEIS annual report and accounts 2019 to 2020 (accessible PDF)
Source: data.gov.uk (2020-10-06)

BEIS annual reports and accounts. This series brings together the annual reports and accounts for the Department for Business, Energy and Industrial Strategy (BEIS).
The reports review the department’s activities over the course of each year, providing:
highlights of key projects
progress made in meeting the department’s objectives
financial information

Annual report
and accounts
2019-20
HC 709

Annual report
and accounts
2019-20
Presented to the House of Commons pursuant to section 6(4) of the
Government Resource & Accounts Act 2000
Ordered by the House of Commons to be printed on 30 September 2020
HC 709

© Crown copyright 2020
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ISBN 978-1-5286-2121-2
CCS0320287242
09/20
Printed on paper containing 75% recycled fibre content minimum
Printed in the UK by the APS Group on behalf of the Controller of
Her Majesty’s Stationery Office

1
Annual report and accounts 2019-20
Contents
Foreword by the Secretary of State
2
Report of the Permanent Secretary
3
Performance report
5
Overview
6
Our purpose 
6
What we set out to achieve
6
Our highlights in 2019-20
8
Where we spent our money in 2019-20
10
Our business model
12
How we are organised: our organisational
structure
13
How we are organised: our group
14
Risks affecting delivery of our objectives 
15
Performance analysis
20
Our performance 
20
Looking ahead
26
Performance against United Nations
sustainable development goals
27
Financial review
29
Sustainability report 
39
Other performance reporting 
42
Accountability report
45
Corporate governance report
46
Statement of Accounting Officer’s
responsibilities
46
Directors’ report
48
Report of the lead non-executive director 50
Governance statement 
51
Staff report
63
Remuneration report
80
Statement of Parliamentary Supply 
91
Parliamentary accountability
disclosures
102
The Certificate of the Comptroller and
Auditor General to the House of
Commons
110
The Report of the Comptroller and
Auditor General to the House of
Commons
114
Financial Statements
115
Consolidated Statement of
Comprehensive Net Expenditure
116
Consolidated Statement of
Financial Position 
117
Consolidated Statement of Cash Flows 119
Consolidated Statement of Changes in
Taxpayers’ Equity (Departmental
Group)
122
Notes to the Accounts
123
Trust Statement
225
Foreword by the Accounting Officer 
226
Statement of Accounting Officer’s
responsibilities for the Trust Statement  229
The Trust Statement Audit Report of
the Comptroller and Auditor General to
the House of Commons
231
Statement of Revenue, Other income
and Expenditure 
234
Statement of Financial Position 
235
Statement of Cash Flows
236
Notes to the Trust Statement
237
Annexes
245
Annex A: Common core tables 
246
Annex B: Glossary
253

2
Annual report and accounts 2019-20
Foreword by the Secretary of State
The Rt Hon
Alok Sharma
Secretary of State for
Business, Energy and
Industrial Strategy
BEIS is playing a crucial role in securing the UK’s long-term future. It has been at
the forefront of the fight against coronavirus, and is now leading Britain’s recovery
by tackling climate change, unleashing innovation and backing business. We will
continue to build on the many achievements outlined in this report over the coming
years to create a stronger, greener future.
Tackling Climate Change
Co-hosting the COP26 UN Climate talks next year gives us the opportunity to
reinforce the UK’s position as a world leader in climate action. Over the past year
BEIS has continued its work to achieve net zero emissions by 2050. The deadline
of coal phaseout was brought forward to 2024. Construction began on the world’s
largest offshore wind development, which will power 4.5 million UK homes. We are
investing £800 million in Carbon Capture, Usage and Storage (CCUS)
infrastructure, enabling us to establish the UK’s first CCUS power plant. We know
there is more to do and further opportunities to be seized as the UK leads a global
green industrial revolution, creating thousands of jobs across the country.
Unleashing Innovation
We are using science and research to unite and level up our country, give people
opportunities, and make the UK a science superpower. In March, we committed to
increasing research and development investment to £22 billion per year by 2025. UK
businesses are leaders in developing high-potential technologies, from nuclear fusion
to space and satellite technology, electric vehicles, and developing a state-of-the-art
climate supercomputer. Our unprecedented investment in science will strengthen
research and build the foundations for the new industries of tomorrow.
Backing Business
The Government’s ambition is for Britain to be the best country in the world to start
and scale a business. We have invested in our key industries and local economies
to level up opportunities across the UK. For workers, we saw the biggest cash
increase ever for the lowest-paid with a new National Living Wage of £8.72 per
hour, and we introduced new rights for paid parental bereavement leave.
Fighting Coronavirus
BEIS has been at the forefront of the Government’s response to the Coronavirus
pandemic. The Department worked quickly to ease regulatory burdens on
business, produce workplace guidance safeguarding workers while supporting the
economy, and agree measures with the energy industry to protect vulnerable
consumers. Through the British Business Bank, BEIS has made available over £50
billion in business loans. Grants have also been given out to nearly 900,000 small
businesses and individuals. We established the Vaccine Taskforce to marshal the
collective effort of government, academia, industry and healthcare to produce a
vaccine as quickly as possible.
Clearly, challenges remain, but I have been impressed by how business and
government have come together to respond to Coronavirus. I am also immensely
proud of the way that BEIS has risen to the challenges of the pandemic, working at
pace to support the economy and safeguard jobs. I want to see this continue, driving
a green recovery in jobs and industry and levelling up across the UK.

3
Annual report and accounts 2019-20
Report of the Permanent Secretary
Sarah Munby
Permanent Secretary
and Principal
Accounting Officer
It is an honour to become Permanent Secretary during such an important
time as we work to help businesses, workers and consumers respond to,
and recover from, coronavirus. On behalf of the Department, I would like to
thank Alex Chisholm for his leadership as BEIS Permanent Secretary until
April 2020, and Sam Beckett for her stewardship of the Department from
April to July.
The Department has rapidly mobilised to best support the response to
coronavirus. We found ways to collaborate ever more closely with
businesses and their representative organisations to deliver vital grants,
loans and advice to all sectors of the economy. We set up a PPE Make Unit
to support the national effort to produce essential equipment and
established the Vaccine Taskforce to drive forward and co-ordinate efforts
to research and produce a coronavirus vaccine.
Our strong global leadership on climate change was recognised when the
UK was selected to co-host with Italy the COP26 UN climate talks. BEIS is
leading on cross-Government policy development ahead of the conference
next November. The Government doubled international climate finance
spend from £5.8 billion to £11.6 billion, and continued to invest in green
technologies – for example by doubling the size of the Energy Innovation
Programme to £1 billion and providing £1 billion over five years to boost
automotive green technologies.
Creating the right conditions to unleash innovation remains a top priority
for the Department. This year Government announced the largest ever
increase in R&D funding, reaching £22 billion by 2024-25. Individual
projects included a £36 million world-first National Timing Centre and a
£40 million investment in quantum technology. We provided £179 million
investment to support the next generation of scientists, mathematicians
and engineers, as well as introducing the first ever Stephen Hawkings
Fellowship. The Space Industry Act was passed into law, enabling the
expansion of commercial space activities in the UK and creating the
potential for hundreds of highly-skilled jobs and billions in investment.
We continue to focus on making the UK the best place to work and grow a
business, whether through our work on the National Living Wage or through
our support to help businesses preparing for the end of the Transition
Period. In particular this year we boosted support for SMEs, announcing
the expansion of the British Business Bank’s venture capital and debt
support programmes. The UK is also making strong progress on improving
gender diversity in senior business positions following the Hampton-
Alexander review: a third of FTSE 100 board positions are now held by
women.
I am immensely proud of all that the Department has delivered over the past
year, during a period of considerable turbulence. We stand ready for our
critical role in the year ahead.

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Performance
report

6
Annual report and accounts 2019-20
Overview
The overview section, pages 6 to 19 provides a summary of the annual report and accounts.
It includes a summary of our performance, expenditure and risks during the year, and our
organisational structure as at the reporting date.
Our purpose
Our purpose is to build an economy which is fairer, cleaner, more innovative, and attracts investment
from all over the world.
What we set out to achieve
BEIS began the 2019-20 financial year with five objectives as published in June 2019, in the
Department’s Single Departmental Plan (SDP). These included:
• delivering an ambitious industrial strategy;
• maximising investment opportunities and bolster UK interests as we leave the EU;
• promoting competitive markets and responsible business practices;
• ensuring the UK has a reliable, low cost and clean energy system; and
• building a flexible, innovative, collaborative, and business facing department.
With the change in government during the financial year, BEIS reprioritised its aims focusing on the
following four priorities:
• Getting businesses ready for Brexit and the opportunities beyond1
• Leading the world in tackling climate change
• Solving the Grand Challenges facing our society
• Making the UK the best place in the world to work and do business
Following the UK leaving the EU on 31 January 2020 and the main aim of the first priority above being
achieved the Department continued to focus on the following three priorities and aims.
1
This priority represented the following aims:

– Deliver a Brexit that works for businesses. Help every UK business get ready for Brexit

– Prepare businesses to take advantage of new trading relationships and markets opened around the world

– Forge an outward looking, free trading, entrepreneurial and creative UK economy outside of the EU.
Note: The second and third aims of Getting business ready for Brexit and opportunities beyond were incorporated into Making the UK the
best place in the world to work and grow a business.

7
Performance report
Leading the world in tackling climate change
• Achieve net zero greenhouse gas emissions and end our contribution to global
warming by 2050.
• Drive economic growth through the race to cut carbon, becoming a leader in green
technologies and clean energy on the path to net zero.
• Accelerate climate action through strong global leadership
Solving the Grand Challenges facing our society
• Increase productivity and improve lives by tackling our Grand Challenges in life
sciences, artificial intelligence, automation and space.
• Making the UK a science superpower through backing ideas and supporting talent
from home and abroad.
• Invest in R&D and innovation to drive discovery and unleash potential
Making the UK the best place in the world to work and grow a business.
• Forge an outward-looking economy, supporting businesses all over the UK to take
advantage of new trading relationships with the EU and around the world
• Reform corporate governance and improve boardroom diversity so the top of UK
businesses better serve and reflect the whole society
• Create fairer, inclusive, flexible workspaces so everyone has the chance to succeed
and balance work and home life.

8
Annual report and accounts 2019-20
Our highlights in 2019-20
Helped businesses, workers and consumers
affected by coronavirus, by introducing loans,
guarantees and cash grants, easing regulatory
burdens and providing greater flexibility on competition
law, annual leave and the testing of new products.
Supported the UK’s world-class scientists by
launching a new simplified process to apply for
research funding, helping to free researchers to focus
more exclusively on undertaking trailblazing research.
Led the world in tackling climate change by
being the first major economy to legislate to end our
contribution to carbon emissions and announcing
that we will double our international climate finance
spend from £5.8 billion to £11.6 billion over the next
five years. This global leadership was recognised
when the UK was chosen to co-host the COP26 UN
climate talks.
Took steps towards achieving net zero by 2050.
Since 1990 we have grown our economy by 75%
whilst cutting emissions by 43%. Renewable sources
provided more electricity to UK homes and businesses
than fossil fuels for the first time in the third quarter of
2019, with less than 1% of electricity generated by
coal-fired power.
Positioned the UK at the global forefront of new
automotive technology development, investing up
to £1 billion over 5 years in R&D and the development
of UK supply chains for the large-scale production of
electric vehicles.
Backed ground-breaking research and
innovation in the UK through key strategic
investments, including £1.2 billion to develop a
state-of-the-art climate supercomputer, £200 million
for a world-leading genomics project and £220 million
for the initial design of a fusion power station.

9
Performance report
Prepared businesses for EU Exit by creating a £15
million Business Readiness Fund for business groups
and trade associations to help firms prepare and
running the Brexit Business Readiness Roadshow with
more than 30 events over five weeks spanning the
breadth of the UK.
Created new legislation to lay the groundwork
for our future outside the EU, covering areas such
as product safety and metrology, employment rights,
carbon emissions and renewable energy.
Introduced a new right to paid parental
bereavement leave, which will mean that working
parents who lose a child under the age of 18 will get
two weeks’ statutory leave.
Increased the National Living Wage to £8.72 per
hour, a 6.2% pay rise for the lowest-paid workers
representing the biggest cash increase ever and
bringing the rate to the target of 60% of median
earnings.
Safeguarded 3,200 jobs in the steel industry by
supporting the sale of British Steel, marking the start
of a new chapter for UK steel.
Continued our work to build a flexible, innovative,
collaborative and business-facing department.
In particular, responding effectively to the coronavirus
crisis by rapidly mobilising staff onto work on the
response to coronavirus; implementing at pace our
new IT collaboration platform ensuring we continued
to work effectively following the move from office to
home working; and by supporting staff with caring
responsibilities.

10
Annual report and accounts 2019-20
Where we spent our money in 2019-20
For the year ended 31 March 2020, the
Departmental Group incurred spend of
£14.1 billion2. Of this £3.1 billion related to the
Core Department and Agencies, and
£11.0 billion related to our partner organisations
and designated bodies.
The diagram opposite shows the major areas of
spend. The majority of the Departmental spend,
and policy delivery is through it’s Partner
Organisations, including:
• £7,793 million by UK Research and
Innovation (UKRI), on funding for Science
and Research
• £2,379 million by the Nuclear
Decommissioning Authority (NDA) on
managing our energy legacy safely and
responsibly.
• £445 million by UK Space Agency (UKSA)
on delivering an excellent space programme
with the maximum economic, scientific and
policy benefit for the UK.
• £479 million by the British Business Bank
(BBB), through the Enable programme,
Northern Powerhouse Investment Fund,
Midlands Engine Investment Fund and
Cornwall and Isles of Scilly Investment Fund,
on supporting small business in the UK at all
stages of their development.
2
The expenditure corresponds to the net Total DEL expenditure for our Departmental Group. DEL is the controllable budget total issued
by HM Treasury on behalf of Parliament, that we use to fund delivery of our strategic objectives. It excludes AME expenditure which
represents volatile, demand-led spend and technical accounting matters. These concepts are fully explained in the Financial Review on
page 29.

11
Performance report
Core Department
Executive agencies
Partner organisations
UKRI
£7,793m
UKSA
£445m
Nuclear
Decommissioning
Authority
£2,379m
BBB
£479m
UK Atomic
Energy Authority
£117m
Diamond Light
Source Ltd
£108m
ACAS
£51m
Coal Authority
£35m
UK SBS Ltd
£35m
Partner organisations
– Other
£5m
Ensuring that
our energy system
is reliable and
secure
£5m
Delivering
affordable
energy for
households
and businesses
£83m
Government as
Shareholder
£98m
Promote competitive
markets and responsible
business practices
£107m
Taking action on
climate change and
decarbonisation
£187m
Managing our energy
legacy safely and
responsibly
£238m
Science and
Research
£253m
Maximise investment
opportunities and bolster
UK interests
£339m
Capability
£435m
Deliver an ambitious
industrial strategy
£894m
Insolvency
Service
(£20m)
Where we spent our
money in 2019-20
£14,066m

12
Annual report and accounts 2019-20
Our business model

Our work and stakeholders
Following ministerial priorities, we design and implement
policy relating to our priorities: leading the world in tackling
climate change, solving the Grand Challenges facing our
society and making the UK the best place in the world to
work and grow a business.
We build strong and collaborative relationships with
stakeholders, including: businesses and business
representative organisations; workers and their unions;
and consultations with the wider public. We also work
closely with and other government departments.
4,345 people
Our people
Our Core Department is made up of 4,345 people with
regional offices across the UK. We are organised in seven
groups; each led by a Director General, and these groups are
in turn divided into 40 Directorates.
40 partner
organisations
Our partner organisations
We also deliver our businesses through 40 partner
organisations. These range from large organisations such as
UK Research and Innovation and the Nuclear
Decommissioning Authority, through medium-size
organisations working on regulation such as the Competition
and Markets Authority, to advisory committees including the
Committee for Climate Change.
£14.1 billion
Our funding
Our annual funding is agreed with Treasury and Parliament.
In 2019-20, we were responsible for the efficient stewardship
of £14.1 billion of Departmental funds.

13
Performance report
How we are organised: our organisational structure
Our ministers
Secretary of State for Business, Energy and Industrial Strategy
Rt Hon Alok Sharma MP
Minister of State
for Business, Ene

rgy
and Clean Growth
The Rt Hon
Kwasi Kwarteng MP
Parliamentary Under
Secretary of State
Minister for Business

and Industry
Nadhim Zahawi MP
Parliamentary Under
Secretary of State
Minister for Science,
Research, and
Innovation
Amanda Solloway MP
Parliamentary Under
Secretary of State,
Minister for Small
Business, Consumers
and Labour Markets
Paul Scully MP
Parliamentary Under
Secretary of State,
Minister for Climate
Change and
Corporate
Responsibility
Lord Callanan
Minister for
Investment (jointly
with the Department
for International
Trade)
Lord Grimstone
Our management: senior ofﬁcials
Permanent Secretary and Principal Accounting Ofﬁcer
Sarah Munby3
Acting Director
General, Corporate
Services
Doug Watkins
Director General,
Energy
Transformation and
Clean Growth
Julian Critchlow
Director General,
Energy and Security
Joanna Whittington
Director General,
Industrial strategy,
Science and
Innovation
Jo Shanmugalingam
Director General,
Market Frameworks
Jaee Samant
Acting Director
General, Trade,
Europe and analysis
Ashley Ibbett
BEIS Scientiﬁc
Adviser
Professor
John Loughhead
Chief Financial
Ofﬁcer
Tom Taylor
Chief Economic
Adviser
Mike Keoghan
Director, Policy
Delivery, and Private
Ofﬁce
Chris Thompson
Director,
Communications
Craig Woodhouse
Our management:
non-executives
Lead
non-executive
board member

Archie Norman
Non-executive
board member
Nigel Boardman
Non-executive
board member
Leena Nair
Non-executive
board member
Stephen A. Carter
Non-executive
board member
Carolyn McCall
Non-executive
board member
Kathryn Parsons
Non-executive
board member
Stuart Quickenden
3
Alex Chisholm was the Permanent Secretary and Principal Accounting Officer until 9 April 2020, then Sam Beckett became Acting
Permanent Secretary and Principal Accounting Officer from 14 April 2020, until Sarah Munby was appointed the Permanent Secretary
and Principal Accounting Officer from 20 July 2020.

14
Annual report and accounts 2019-20
How we are organised: our group
Public sector bodies can be grouped by level of
control the Core Department has over them.
• Our executive Agencies act as an arm of
the Core Department, undertaking executive
functions, rather than policy advice.
• Other bodies in the Departmental Group
are separate legal entities, but the Core
Department usually sets their strategic
framework, appoints the chair and all
non‑executive members of board, and is
consulted on the appointment of the CEO.
• The wider Departmental Group includes
other public‑sector bodies which work to
achieve our objectives but have more authority
over their policies and are not consolidated
into the group financial statements. See our
Accounting Officer System Statement,
published separately, for greater detail.
Core Department and Agencies
Insolvency Services
Copyright Tribunal
Council for Science and Technology
Government Ofﬁce for Science
Industrial Development Advisory Board
Committee on Fuel Poverty
Low Pay Commission
UK Space Agency
Ofﬁce of Manpower Economics
Ofﬁce of Product Safety and Standards
Ofﬁce of the Regulator of Community Interest Companies
Regulatory Policy Committee
Nuclear Liabilities Financing Assurance Board
Consolidated Departmental Group
Advisory, Conciliation and Arbitration Service (ACAS)
British Business Bank Plc
Central Arbitration Committee
Certiﬁcation Ofﬁcer
Civil Nuclear Police Authority
Coal Authority
Committee on Radioactive Waste Management
Committee on Climate Change
Competition Appeal Tribunal
Competition Service
Electricity Settlements Company
Financial Reporting Council
Low Carbon Contracts Company Ltd
Nuclear Decommissioning Authority
Oil and Gas Authority
UK Atomic Energy Authority
UK Green Infrastructure Platform Ltd
UK Shared Business Services Ltd
UK Research and Innovation
Wider departmental group
British Hallmarking Council
British Nuclear Fuels Limited
Companies House4
Competition & Markets Authority
Groceries Code Adjudicator
Independent Complaints Reviewer
Intellectual Property Ofﬁce
International Nuclear Services Limited
Land Registry4
Met Ofﬁce
National Nuclear Laboratory
National Physical Laboratory
Nuclear Liabilities Fund
OFGEM
Ordnance Survey
Post Ofﬁce Ltd
Pubs Code Adjudicator
Small Business Commissioner
4
4
These entities have been re-classified by ONS in 2018-19. See footnote 2 in note 27: list of bodies
within the Departmental Group, for an explanation of the impact of this change

15
Performance report
Risks affecting delivery of our objectives
Risk Management
Our risk management framework continued to develop and improve over the last year, further
information on this can be found in the governance statement section of this report.
The BEIS risk management framework is structured around the following five principles, which
complement and build upon those outlined in the Orange Book.
Accountable
Risk management is the responsibility of all staff. Senior management should
ensure that roles and responsibilities are clear, communicated, understood and
embedded at all levels of the organisation. This includes equipping staff with the
skills to manage risk and understand where they can afford to take more risk, what
necessitates immediate escalation / corrective action.
Open
Senior management should ensure that risk discussions are transparent and
considered integral to making informed decisions (e.g. policy making, strategy
setting, planning, Programme and Project Management).
Evidence-
Based
All staff should consult with relevant stakeholders to produce timely and accurate
risk information via the online reporting system and the control and assurance
record to support decision-making.
Proportionate Risk management processes should enable – not drive – our work. So all staff
should consistently review and identify risk as part of their business activity using
existing governance arrangements.
Consistent
All staff should consistently review and identify risk as part of their business activity
e.g. using existing governance arrangements - such as committees, team meetings
or deep dives - to increase visibility and focus on meaningful actions.
The table below describes our risk profile: principal risks we have faced during the financial year and the
mitigating actions taken.
Key:
Icons in the table map the risk to our objectives
Solving the Grand Challenges
facing our society
Making the UK the best place
in the world to work, and to
grow a business
Leading the world in tackling
climate change
Relative
severity
H High
M Medium
L Low
Change during
the year

Increasing risk
Stable

Decreasing risk

16
Annual report and accounts 2019-20
Risk
Mitigating activities
Risk severity and direction
of risk trend
Failure to meet
carbon budgets
due to ineffective
measures to mitigate
climate change and
promote clean energy
investment

Æ We have developed and implemented further
policies to deliver emission reductions in line
with Clean Growth Strategy and Net Zero
commitments, and committed additional funding
in areas including energy, industry, transport and
low carbon buildings.

Æ We continue to refine and strengthen our analysis
of future emissions and the potential contribution
of different policy areas to reducing emissions.

Æ We have strengthened governance including
through a new Climate Action Strategy
Committee, chaired by the Prime Minister, to
drive further action on domestic and international
climate change.

Æ We became the first major economy in the world
to set a legally binding target to reach net zero
greenhouse gas emissions by 2050.

Æ We published the Green Finance Strategy, setting
out plans to mobilise capital into low carbon
investments.
H
Catastrophic or severe
incident affecting
energy or nuclear
critical national
infrastructure

Æ We work with the Office for Nuclear Regulation
(ONR) to ensure safety and security standards
are maintained, including strengthening regulatory
framework where necessary.

Æ We continue to ensure robust safety and security
(physical, personnel and cyber) arrangements are
in place at civil nuclear sites.

Æ We maintain a robust capability building
programme to increase BEIS preparedness
to lead an effective and coordinated cross-
government response.

Æ We undertake a programme of collaboration
through regular engagement with industry to
identify vulnerabilities and mitigate cyber risks not
addressed through regulation.

Æ We work with HM Government and industry
partners to ensure physical and personnel
security standards in the energy sector are
proportionate and robust.
L

17
Performance report
Risk
Mitigating activities
Risk severity and direction
of risk trend
Sensitive information is
lost or compromised
through cyber-attack,
theft, mistakes or
leaks, or a security
incident at work harms
BEIS ministers, staff or
visitors.

Æ We continue to develop a culture of security
through staff awareness campaigns to reinforce
simple security behaviours – technical and
physical defences are not enough on their own.

Æ We continue to maintain strong and tested cyber
defences.

Æ We are building a more coherent approach to
personnel security to mitigate the insider threat
and minimise the security vulnerabilities caused
by staff mistakes.

Æ We maintain a risk-adjusted and systematic
approach to monitoring and assuring security in
BEIS and its Partner Organisations.

Æ We are working with other government
departments to realise the benefits of security
centralisation and professionalism across
government.
H
BEIS is satisfied that all
possible avenues are in place
to mitigate this risk, however,
the rating remains high due to
the increasing nature of cyber-
attacks and reflecting the
importance of staff safety.
Failure to attract,
develop and retain
sufficiently skilled staff
and support their
wellbeing

Æ We have ensured senior leaders maintain
oversight of teams, tracking that leave is taken,
hours worked are proportionate and flexible
working options are considered.

Æ We carried out extensive workforce planning to
develop resourcing plans, ensure the correct mix
of grades in each profession, and review strategy
and international capability.

Æ We actively monitor the results of our People
survey to improve staff retention with new
learning and development packages and the
appointment of Wellbeing Champions.

Æ We carry out an annual Wellbeing survey and act
on the results.
H
Over the financial year this
risk has increased due to
the increasing remit of the
Department.
We may lack the
strategic and cultural
flexibility to manage
the impacts of a rapid
change to priorities

Æ To support strategic decision-making we maintain
a robust reporting system to ensure that risks
and issues are identified early and considered by
senior leaders.

Æ We have a dedicated team developing our Target
Operating model, to strengthen the Department’s
capability.

Æ We continued to identify future trends through
horizon scanning of our external environment and
recruited people with the necessary commercial,
technical and operational skills.
M

18
Annual report and accounts 2019-20
Risk
Mitigating activities
Risk severity and direction
of risk trend
Inadequate
availability, quality,
or understanding
of evidence base
underpinning policy
development and
delivery.

Æ We produce Quality Assurance (QA) scores for
all business critical models. Our overall score is
above target.

Æ We completed a review of analytical governance
and strengthened frameworks in place for
assurance of analysis used in decision making.

Æ We increased early monitoring requirements
at policy development stage and improved
mechanisms for reviewing implementation of
monitoring through departmental boards.

Æ We continued to develop a central archive of
completed appraisal, monitoring and evaluation
activity to support better, more efficient analysis
and policy development.

Æ We published the latest Areas of Research
Interest.
M
Closed or
deescalated risks
Mitigating activities
Narrative
Failure to prepare for
EU Exit

Æ We have continuously assessed delivery
requirements and developed a prioritisation
strategy to manage EU Exit work.

Æ We have redeployed and mobilised staff to
priority EU Exit areas.

Æ We have worked with other government
departments to ensure a coherent cross-
Whitehall governance structure for negotiations
and identify and resolve strategic trade-offs.

Æ We have engaged with HM Treasury to develop
a strong evidence base, based on a sectoral
analysis of impacts, to refine low-alignment
scenario planning and refine BEIS’s flexible
business support package.

Æ We have led broad engagement with businesses,
in coordination with other government
departments, to deliver readiness messaging,
as well as developing material, including online
checklists and a self-certification tool for
businesses.
The changing nature of the
challenges of Brexit and the
impact of external factors
resulted in this risk remaining
high through most of the
financial year with an improved
picture towards the point
when the risk was closed.

19
Performance report
Closed or
deescalated risks
Mitigating activities
Narrative
We fail to adapt
employment legislation
leading to a rise in
unfair employment
practices and a failure
to deliver ‘good quality
work’.

Æ We have progressed consultations and
preparation of clauses to deliver on ‘Good Work
Plan’ commitments.

Æ We have developed robust quality of work
metrics.

Æ We collaborated with DfE to monitor the
development and implementation of skills reform
programmes, e.g. national retraining schemes,
apprenticeships devolution of the adult education
budget and T-levels.
As a result of the Employment
Rights Bill being announced,
this risk has been
de‑escalated. The risk is now
being monitored and managed
by the Director General.
As a result of political
uncertainty and
potential economic
upheaval following
EU Exit, which could
be compounded by a
challenging Spending
Review for the
Strategy, there is a risk
that partners across
government, local
areas and industry will
not sufficiently engage
with and support the
Industrial Strategy.

Æ Ensuring Spending Review bids by departments
are aligned with the Industrial Strategy.

Æ Work with ministers, No.10, and HM Treasury
to define ambition and ensure resources are
available for implementation.

Æ Use cross-Government Programme Board,
Cabinet Committee and partnerships with local
government, Local Enterprise Partnerships,
businesses, civic society and academia to drive
implementation and measure the impact on the
economy.

Æ Work closely with EU Exit colleagues recognising
the potential synergies with Industrial Strategy,
and to remain aware of how the negotiations
could affect our ability to improve productivity and
drive growth across the whole country.

Æ Effectively engage with UK industry and
business through events and comprehensive
communications.
Whilst this area is a high
priority the specific risk
has been closed as the
Department refocused its
attention towards the Grand
Challenges and unleashing
innovation.
COVID-19 response risk management practices
The COVID-19 pandemic response has
presented the Department with significant
challenges. In order to manage the associated
risks, BEIS has put in place a programme of work
pulling expertise from across the Department. A
central Project Management Office has been
established to effectively manage the
Departmental response. Additionally, the strategic
risk management function has supported the
programme to design a risk management
process in line with the Departmental Framework
and to identify and manage emerging COVID-19
risks.
The BEIS Risk Management Framework and Risk
Appetite Statement are reviewed and refreshed
on an annual basis. This assessment will be
reviewed taking account of COVID-19 to provide
effective risk management to deliver Government
policies.

20
Annual report and accounts 2019-20
Performance analysis
Our performance
BEIS reviewed and updated its Departmental
priorities this year. The structure of this report
follows those updated priorities, which differ from
those in the Single Departmental Plan (SDP)
published in June 2019. An additional section is
included reflecting on BEIS’s response to
COVID-19 pandemic.
Leading the world in tackling
climate change
This departmental priority is an increase in our
ambition and strengthening of our commitment
to the Department’s fourth objective published in
the Department’s SDP to Ensure the UK has a
reliable, low-cost, and clean energy system.
Domestic work
In June 2019, the UK became the first major
economy in the world to legislate to end its
contribution to global warming by 2050. The
target will require the UK to bring all greenhouse
gas emissions to net zero by 2050, compared
with the previous target of at least 80% reduction
from 1990 levels. This is one of the most
ambitious targets in the world and demonstrates
the leadership the UK is providing internationally
in this area.
To support the achievement of this target:
• we introduced the Smart Export Guarantee,
which ensures that small-scale electricity
generators installing solar, wind or other forms
of renewable generation will be paid for each
unit of electricity they provide to the network;
• we awarded nine companies with £26 million
of funding to advance the rollout of carbon
capture, utilisation and storage in the UK,
which is a crucial step towards ending the
UK’s contribution to global warming.
£4.2 million of this will go to Tata Chemicals
Europe’s plant in Cheshire to contribute to the
construction of a facility to capture and utilise
40,000 tonnes of carbon dioxide a year- the
equivalent of 22,000 cars;
• we announced £142.9 million investment in
green projects, including:
– Greenhouse Gas Removal Technologies –
£31.52 million – this will support the UK in
its net zero ambitions, by driving forward
approaches to remove greenhouse gases
from the sky on a large scale;
– Clean Air: Addressing the Challenge of
Indoor & Outdoor Pollution – £22 million –
the next decade will see declining transport
pollution but increases in other areas like
household products and adhesives. This
project will look at tackling emerging air
pollutants indoors and outdoors, such as air
fresheners and cleaning products, to
minimise their effects on public health;
– cleaner food systems for healthy people and
a healthy planet – £47 million –– this will
transform UK diets to be healthier and more
sustainable through changes in production,
manufacturing, retail and consumption;
– reusing and recycling materials in innovative
ways – £30 million – this programme will
drive forward new research to support
opportunities to re-use and recycle materials
across sectors such as food, water, textiles,
and electronics – as well accelerating new,
greener manufacturing technologies; and
– Sustainable Management of Marine
Resources – £12.43 million – This
programme will ensure that the UK realises
sustainable societal and economic benefits
through better management of the UK’s
marine resources.
• in February 2020, as part of the BEIS
£505 million Energy Innovation Programme
and additional UKRI funding, we announced a
£90 million package to tackle emissions from
homes and heavy industry. This included

21
Performance report
funding for the development of Europe’s first
large scale, low carbon hydrogen plants in
Merseyside and Aberdeen, which could
generate enough clean energy to heat over
200,000 homes;
• we published the Green Finance Strategy,
which sets out a comprehensive approach to
greening financial systems, mobilising finance
for clean and resilient growth, and capturing
the resulting opportunities for UK firms; and
• the Prime Minister chaired the first meeting of
the new Climate Action Strategy Committee,
which will drive further action across
government and play an essential role in
co-ordinating our strategy to reach net zero
emissions.
International work
The UK cannot solve the challenges of climate
change alone, so we are working internationally
as well as domestically to tackle the issue. Our
leadership has driven change on the ground and
shifted the debate and mobilised finance
internationally:
• In September 2019 at the United Nations, the
UK committed to doubling our International
Climate Finance (ICF) to £11.6 billion between
2021-22 and 2025-26. This will help
developing countries make the transition to
low-carbon and climate resilient development.
As part of the ICF, we launched the new
Ayrton Fund of up to £1 billion to allow British
and other scientists from around the world to
work in partnership with developing countries
to drive the clean energy transition. At the G7
Summit in August 2019, the UK also pledged
to contribute £1.44 billion to the Green Climate
Fund over the next four years. This doubles
the UK’s previous contribution of £720 million
between 2014 and 2019; and
• We announced an investment package worth
over £100 million for clean energy and energy
efficiency at the African Investment Summit.
Solar farms in Kenya, geothermal power
stations in Ethiopia and clean energy storage
across sub-Saharan Africa will receive funding
and see leading UK scientists and financial
experts working with their African counterparts
to realise the continent’s huge potential for
renewable energy. The Prime Minister also
announced an end to UK direct bilateral
support for thermal coal mining or coal power
plants overseas.
Solving the Grand Challenges
facing our society
The Industrial Strategy sets out Grand
Challenges to put the UK at the forefront of
the industries of the future, ensuring that the
UK takes advantage of major global changes,
improving people’s lives and the country’s
productivity.
The first 4 Grand Challenges are focused on the
global trends which will transform our future:
Future of mobility
• We announced up to £1 billion additional
funding to develop and embed the next
generation of cutting-edge automotive
technologies. This funding will be used to
develop UK supply chains for the large-scale
production of electric vehicles and will also be
used for further research and development in
our world leading research centres. It will
accelerate mass production of key
technologies in the UK through major
investments in the manufacturing of batteries,
electric motors, power electronics, and
hydrogen fuel cells, along with their
component and materials supply chains; and
• As part of the Faraday Battery Challenge, we
announced £23 million government investment
to keep the UK at the forefront of developing
the latest electric vehicle technology. This
forms part of the total £274 million that will be
awarded to consortia across the UK through
the Faraday Battery Challenge, part of the
government’s Industrial Strategy Challenge
Fund (ISCF).
Ageing society
• We announced a new dedicated investment
programme of around £600 million to unlock
the potential of the UK’s best health and life
science innovations. The funding will comprise

22
Annual report and accounts 2019-20
a £200 million investment through the
government-owned British Business Bank
alongside private sector investment, which is
expected to contribute a further £400 million,
allowing companies to grow and ensure the
UK remains a world-leader in life sciences
innovation; and
• We launched the world’s largest genetics
project, the £200 million whole genome
sequencing project of 500,000 volunteers in
the UK Biobank. The new project aims to
improve the prevention, diagnosis and
treatment of a wide range of serious and
life-threatening illnesses including cancer,
heart diseases, diabetes, arthritis and
dementia, through genetic research that can
explain why some people develop these
conditions and others do not.
Artificial intelligence and data
• We announced the UK’s first ever tourism
sector deal, which will revolutionise the way
data is used by the sector, through the
creation of a new Tourism Data Hub. The deal
will also support the creation of an additional
10,000 apprenticeships for people building
their careers in the tourism and hospitality
sectors;
• We launched a new Cambridgeshire and
Peterborough Local Industrial Strategy, which
is designed to maximise productivity and
innovation in the area’s leading life sciences,
food production, artificial intelligence, and
advanced manufacturing sectors, and features
a Skills and Apprentices Hub to support the
local economy; and
• We announced funding to support up to 2,200
students through 41 Doctoral Training
Partnerships, as well as encourage more
young people, particularly girls, to study
science, technology, engineering and
mathematics (STEM) subjects at school and
university, and pursue a STEM-related career.
The investment includes:
– £179 million for PhDs, formally known as
Doctoral Training Partnerships, at over 40
UK universities in physical sciences, maths
and engineering to develop the skills for
ground-breaking research and high-tech
industries like cyber security and chemical
manufacturing. Part of the investment will
go into pilots looking at how best to attract
and support those from non-academic
backgrounds to undertake this type of
training; and
– £8.9 million to continue funding science
education programmes including Science
Learning Partnerships and Stimulating
Physics Networks, which aim to improve
science teaching and increase the take up
of science at GCSE level and A level and
ultimately encourage young people to
pursue a STEM‑related career.
Clean Growth
• We announced £300 million investment to
develop cleaner, greener forms of transport.
The government will provide £125 million,
which will be supported by industry
co‑investment of up to £175 million to support
exciting new technologies including flying
urban taxis, electric passenger planes and
even freight-carrying drones; and
• We announced a £98 million investment,
allowing both UK researchers and small
businesses to seize the opportunities in
science and innovation and industries of the
future. Of this, £78 million will be invested in
78 scientists and researchers through the
government’s Future Leaders Fellowships
scheme. The remaining £20 million will be
allocated to 20 universities to develop new
University Enterprise Zones (UEZs) across the
country to provide vital specialist support to
small businesses in pioneering industries – like
Artificial Intelligence (AI), clean growth, smart
energy and agri-food.
Making the UK the best place in
the world to work, and to grow a
business
This departmental priority combines the
Department’s second and third objectives
published in the Department’s SDP to Maximise
investment opportunities and bolster UK interest
as we leave the EU and Promote competitive

23
Performance report
markets and responsible businesses practices,
now the UK has left the EU.
Our work towards delivering this objective is
directed towards providing support for
employees and businesses and regulating
the market.
Supporting Employees
• In 2020, we legislated to increase the National
Living Wage (NLW) by 6.2%, from £8.21 per
hour to £8.72 per hour – the biggest cash
increase ever. Nearly 3 million workers are now
benefitting from the increases to the NLW and
minimum wage rates for younger workers,
according to estimates from the independent
Low Pay Commission;
• 3,200 high-skilled jobs in Scunthorpe,
Skinningrove and on Teesside were
safeguarded by the completion of a deal to sell
British Steel to leading Chinese steelmaker
Jingye Group. The sale followed extensive
discussions between the government, the
Official Receiver, Special Managers, unions,
suppliers and employees. It marks a critical
step in securing a long-term, sustainable
future for steelmaking in Yorkshire and the
Humber and the North East. As part of the
deal, Jingye Group pledged to invest
£1.2 billion over 10 years to modernise British
Steel sites and boost energy efficiency;
• We announced we were building on measures
designed to support working parents as part
of the Good Work Plan by extending legal
protections against redundancy for new
mothers returning to work by six months.
Parents returning from adoption and shared
parental leave will also be protected;
• We introduced regulations in Parliament which
mean that from the 6th April employed parents
who suffer the loss of a child under the age of
18 are now entitled to two weeks statutory
Parental Bereavement Leave and Pay; and
• As announced in the Queen’s Speech and at
Budget, we intend to legislate to give parents
of children in neonatal care access to
additional weeks of leave and pay to support
them during this traumatic time and when they
return to work.
Supporting Businesses
• We widened eligibility for Relief for Energy
Intensive Industries to enable more businesses
to benefit from support schemes, whilst
investing in their greener future;
• We made £15 million of funding available to
support trade associations and other business
representative organisations to work with
businesses across the UK to understand the
steps they should take to be ready for Brexit;
• In 2019-20, we ran advertising campaigns to
support business growth including advertising
to support businesses to prepare for Brexit as
part of the Cabinet Office ‘Get Ready’
campaign, workers on national and living wage
and to help future proof skills relevant to the
engineering industry;
• We published the Business Productivity
Review, which was jointly undertaken with
HM Treasury. It outlines plans to spend
£56 million to support business productivity
and highlights ten key actions to drive forward
change and improve productivity; and
• We announced £88 million of new government
investment to help close the productivity gap
between the UK and major world economies:
– £43 million in government investment will
support top researchers and analysts to
explore how to turbocharge UK productivity
levels through a new ambitious productivity
institute; tackling barriers such as
productivity imbalances between sectors
and regions, poor management practices
and skills investment; and
– a further £45 million will be specifically
invested by the government into the
development of cutting-edge
supercomputer software, set to transform
whole sectors from agriculture and
advanced aerospace to Formula One and
pharmaceuticals with hyper-accurate
weather predictions – helping them plan and
in turn boost their productivity.

24
Annual report and accounts 2019-20
Regulation
• We announced tough new powers for the
Competition and Markets Authority to fine
businesses directly who have broken
consumer law. The move will help tackle the
loyalty penalty and practices such as
subscription traps and unfair cancellation
charges. Firms that overcharge or mislead
their customers could be hit with direct fines
without the need to go through a court; and
• We consulted on creating a single labour
market enforcement body, which will have
powers to enforce minimum wage and holiday
payments. We will also crackdown on
non‑disclosure agreements.
COVID-19
The global pandemic emerged at the end of
2019-20 and BEIS moved quickly to put in place
the Government’s response to the COVID-19
crisis:
• On Monday 23 March, we launched the
Coronavirus Business Interruption Loan
Scheme (CBILS) through the British Business
Bank, to provide government-backed loans
of up to £5 million to small and medium
businesses.
Since 1 April 2020, the government has
continued to support the economy through the
following schemes, and as at 16 August 2020:
• the CBILS has approved £13.68 billion of
support:
• the Coronavirus Large Business Interruption
Loan Scheme (CLBILS) was launched on
Monday 20 April to provide government-
backed loans of up to £200 million to larger
businesses and it has approved £3.50 billion
of support:
• the Bounce Back Loan Scheme (BBLS) was
launched on Monday 4 May to provide
government-backed loans of up to £50,000 to
small and medium businesses and it has
approved £35.47 billion of support; and
• the Future Fund was launched on Wednesday
20 May to provide convertible loans of up to
£5 million where government investment is
matched by third-party investors and it has
approved £588.3 million of support.
• We announced over £12.3 billion of grant
support for eligible small businesses and
businesses in the retail, hospitality, and leisure
sectors to mitigate the impact of COVID-19;
• We amended the Working Time Regulations
1998 to allow workers who cannot take
holiday due to the coronavirus to carry most,
or all, of their leave into the next two leave
years. This ensures that workers will not lose
their leave entitlements and gives flexibility to
business at a time when it is needed most;
• We enabled businesses to apply for a three-
month extension for filing their accounts and
guaranteed that any business citing issues as
a result of COVID-19 will be automatically and
immediately granted an extension. We also
announced that we would legislate to offer
further flexibilities covering requirements on
companies to file information and to run their
general meetings;
• We agreed new emergency measures with the
energy industry to protect the domestic energy
supply of those most in need. All customers
with pre-payment meters can speak to their
supplier about options to keep them supplied,
such as nominating a third party for credit top
ups, having a discretionary fund added to their
credit or being sent a pre-loaded top up card.
More broadly, any energy customer in financial
distress will also be supported by their
supplier, which could include debt repayments
and bill payments being reassessed, reduced
or paused where necessary, while
disconnection of credit meters will be
completely suspended;
• We temporarily eased administrative
requirements to fast-track supplies of Personal
protective equipment to NHS staff and protect
companies hit by the pandemic;
• We announced changes to support UK
companies facing insolvency measures.
These included the introduction of corporate
restructuring tools to give companies a better
chance of survival, such as a moratorium
to give companies time to seek rescue.

25
Performance report
The measures also included temporarily
suspending parts of insolvency law to help
directors continue trading through the
emergency and ensure ongoing access to
much-needed supplies such as energy and
raw materials;
• We announced funding for six coronavirus
research projects, including two focused on
vaccination trials, which will benefit from a
share of £20 million in government investment.
Two government-backed projects will receive
new funding, enabling pre-clinical and clinical
vaccine trials, as well as supporting
researchers to develop manufacturing
processes to produce a vaccine at a million-
dose scale. Other projects receiving funding
examine how existing treatments could be
repurposed to treat coronavirus, developing
antibodies to help target the virus, and
examining how people at greatest risk of
catching it could be identified; and
• Through a £20 million investment, a
consortium of the UK’s leading clinicians and
scientists will look for breakthroughs that help
the UK respond to this and future pandemics
and save lives. COVID-19 Genomics UK
Consortium – comprised of the NHS, Public
Health Agencies, Wellcome Sanger Institute,
and numerous academic institutions – will
deliver large scale, rapid sequencing of the
cause of the disease and share intelligence
with hospitals, regional NHS centres and the
government.

26
Annual report and accounts 2019-20
Looking ahead
What we are aiming to achieve
We will lead Britain’s recovery, rebuilding a more
dynamic, green and productive economy and
preparing businesses and workers for
opportunities outside of the EU.
Fighting Coronavirus
We will support a safe return to work, restoring
livelihoods and rebuilding consumer confidence.
We will help businesses to bounce back, putting
in place a future programme of support for
business and workers, as well as more targeted
support to deliver a job rich recovery that
contributes to delivering net zero. In addition, we
will protect lives by significantly and rapidly
increasing domestic vaccines research capability
and capacity for production, through the work of
the Vaccine Taskforce.
Backing Business
We will increase opportunity by levelling up
economic activity across all parts of the UK,
supporting SMEs and helping business create
jobs. We will take steps to remove regulatory
barriers and promote regulations that
supercharge growth and investment. Through
reform measures we will regain public trust in the
audit, governance and insolvency regimes. As
the transition period draws to a close, we will
seize the opportunities of global free trade and
play an important part in negotiations on the EU
and Rest of World Free Trade Agreements.
Unleashing innovation
We will make the UK a science super power by
backing ideas, eliminating bureaucracy and
supporting talent from home and abroad. We will
translate our biggest increase in R&D spend into
world-beating innovation, catalysing private
sector investment to promote the development
of cutting-edge technology. We will put UK
research funding on a firm footing after EU Exit,
laying the groundwork for the establishment of a
‘high risk, high payoff’ new UK agency for
research, due to open in 2021.
Tackling Climate Change
We will drive the green recovery by setting out
measures to decarbonise transport, buildings,
energy and industry; deploy carbon capture,
usage and storage at scale; and significantly
increase offshore wind capacity. We will lay the
groundwork for establishing a Gigafactory to
manufacture electric car batteries in the UK
within the next three years. In preparation to host
a successful COP26 in November 2021, we will
push for countries to renew their climate change
to accelerate urgent climate action to protect
our planet.

27
Performance report
Performance against United Nations sustainable
development goals
The Sustainable Development Goals (SDGs) succeed the Millennium Development Goals (MDGs),
which ended in 2015. They were developed by United Nations (UN) member states and include 17
global goals for 2016 – 2030. UK government departments are required to look within their single
departmental plans to identify policies and programmes which support delivery of the SDGs. BEIS
contributes mainly to goals 7, 9 and 13.
Sustainable
development goals
Progress in 2019-20
BEIS delivery
area
Goal 7
Ensure access to
affordable, reliable,
sustainable and modern
energy for all
In 2014, the government introduced in legislation a fuel poverty
target for England to improve as many fuel poor homes as is
reasonably practicable to a minimum energy efficiency rating of
Band C, by the end of 2030. This year, we ran a consultation to
update the fuel poverty strategy.
The Smart Metering Implementation Programme is an important
national modernisation programme that will bring benefits to
consumers, businesses and the nation as a whole. We published
the latest assessment of the costs and benefits of the smart
meter roll-out based on the most up-to-date evidence from the
programme.
Goal 9
build resilient
infrastructure, promote
inclusive and sustainable
industrialisation and
foster innovation
The Industrial Strategy looked at global trends, areas of
UK strength and where there is scope for productivity
enhancement to identify four Grand Challenges. Among
measures to respond to these challenges, we have:
• published the joint BEIS/HM Treasury Business Productivity
Review, which sets out 10 key actions that will support
businesses to become more productive, backed by £56
million funding;
• awarded £2 million to the winners of a competition for our
Centre for Connected and Autonomous Vehicles to support
the development of cyber-security testing capability.
Goal 13
Take urgent action to
combat climate change
and its impacts
In June 2019 the UK became the first major economy in the
world to legislate to end its contribution to global warming by
2050. The target will require the UK to bring all greenhouse gas
emissions to net zero by 2050, compared with the previous
target of at least 80% reduction from 1990 levels.
The UK, in partnership with Italy, will host the UN’s 26th
Conference of the Parties (COP26) to the UN Framework
Convention on Climate Change (UNFCCC) in Glasgow from
1-12 November 2021 – the largest political summit hosted by
the UK in decades, with up to 150 world leaders and 30,000
delegates attending.
Goal 1
End poverty in all its
forms
In December, we announced that the National Living Wage
(NLW) was increased by 6.2% in 2020 – the biggest cash
increase ever. Nearly three million workers now benefit from the
increases to the NLW and minimum wage rates for younger
workers, according to estimates from the independent Low Pay
Commission.

28
Annual report and accounts 2019-20
Sustainable
development goals
Progress in 2019-20
BEIS delivery
area
Goal 5
Achieve gender equality
and empower all women
and girls
The Hampton-Alexander Review focuses on improving women’s
representation in senior roles, and this year’s report shows that
women are now holding 32.4% of all FTSE 100 board positions –
up from 30.2% last year and the strongest year of progress since
2011. Following successful campaigning and pressure from
investors, ‘One & Done’ boards (a term to describe firms that are
appointing a token woman to their board) have reduced from 74
to 39 this year. Only two all-male boards remain, down from 152
in 2011.
Goal 8
promote sustained
inclusive and sustainable
economic growth,
full and productive
employment and decent
work for all
To ensure that businesses are prepared to seize the economic
opportunities arising from the UK’s exit from the EU we
developed sector specific measures to support businesses
through the transition and ensured that the UK’s trade
negotiations contain provisions for small and medium-sized
enterprises.
We implemented the secondary legislation reforms of the
Matthew Taylor Review which includes protections for agency
workers and published the Good Work Plan, which sets out our
vision for the future of the UK labour market.
Goal 11
make cities and human
settlements inclusive,
safe, resilient and
sustainable
As part of the government’s commitment to level up regions
outside of London and the south east we:
• published six Local Industrial Strategies, including those
for Greater Manchester, the West of England, Oxford and
Cambridge; and
• worked with the Marches Local Enterprise Partnership to
publish a new 10-year energy plan that will see half of the
region’s electricity produced by renewable sources by 2030, a
national pilot scheme developed for overcoming disruption to
the National Grid and fuel poverty cut to below ten per cent.
Goal 12
Ensure sustainable
consumption and
production patterns
Ministers have always maintained that the exploration of
England’s shale gas reserves could only proceed if the science
shows that it is safe, sustainable and of minimal disturbance
to those living and working nearby. Based on the report by the
Oil and Gas Authority, ministers took the decision to suspend
fracking for shale gas in England.

29
Performance report
Financial review
Expenditure
How expenditure is presented
The Department’s expenditure is reported in the
financial Statements, in the Statement of
comprehensive net expenditure (SoCNE) (page
116) and the Statement of Parliamentary Supply
(SoPS) (page 91), but on different bases. The
financial statements are prepared in accordance
with accounting standards and guidance which
are explained in more detail in the Department’s
accounting policies in note 1.1 and on a similar
basis to the rules generally applied by private
sector businesses.
The Departmental Group’s net operating
expenditure was £33.5 billion and £26.3 billion
for the Core Department and Agencies.
The SoPS is specific to the public sector.
It reports the Department’s expenditure against
the control limits that Parliament has voted on.
The SoPS presents total expenditure for the
Departmental Group of £33.8 billion, compared
to the Department’s Budget £31.2 billion.
These figures are calculated in accordance
with HM Treasury’s Consolidated Budgeting
Guidance, which differs in several respects from
the accounting basis above. It is against these
limits that the Department is held accountable for
its performance and use of taxpayers’ funds.
The summaries and explanations of key
movements in this section is based on the SoPS,
except where otherwise stated.
Overview of expenditure in 2019-20
2019-20
Budget
£m
2019-20
Outturn
£m
2018-19
Outturn
£m
TME1,2
31,168
33,844
(94,221)
Resource DEL
3,555
2,838
1,246
Capital DEL
11,835
11,228
10,814
Total DEL3
15,390
14,066
12,060
Resource AME
15,055
19,915
(105,865)
Capital AME
723
(137)
(416)
Total AME5
15,778
19,778
(106,281)
1
The TME outturn corresponds to ‘total voted and non-voted’ outturn in the SoPS.
2
The TME outturn is the total of Voted and Non-Voted in the Statement of Parliamentary Supply.
3
This expenditure is analysed in ‘Where we spent our money’ on pages 10 and 11.
Our budget framework
TME
AME
DEL
Resource
DEL
Programme
RDEL
Admin
RDEL
Capital
DEL
General
capital
Financial
transactions
HM Treasury sets the budgetary framework for
government spending.
The total amount a department spends is
referred to as the Total Managed Expenditure
(TME); which split into:
• Annually Managed Expenditure (AME)
• Departmental Expenditure Limit (DEL)
HMT do not set firm AME budgets. They are
volatile or demand-led in a way the
Department cannot control. The Department
monitors AME forecasts closely and updates
them annually.
HMT set firm limits for DEL budgets, as DEL
budgets are understood and controllable.
The limit is set at spending reviews which
occur every three to five years.
DEL budgets are classified into resource and
capital.
Resource DEL includes a further split into:
• ‘programme’ budgets for frontline service
provision
• ‘admin’ budgets such as back-office
functions, rent and IT
Capital DEL includes a further split into
• ‘financial transactions’ for loans given or
shares purchased.
• ‘general capital’ for spending on all other
assets or investments

30
Annual report and accounts 2019-20
This expenditure does not represent cash spend. The Departmental Group’s performance in any year
is impacted by accounting ‘fair value’ movements. As they are non-cash adjustments, they do not
feature in standard descriptions of spend, such as in ‘Where we spent our money’, shown in the
Performance report.
The significant movements in resource AME this year come from, the recognition movements in the
fair value of the Contracts for Difference, changes to discount rates and cost estimate adjusting
provisions in particular the NDA’s nuclear decommissioning provision.
Variations in our expenditure against the budget and the previous years are explained below in further
detail.
Comparison of expenditure to previous years recognised in SOPS
The Department’s key areas of net expenditure recognised in SOPS for the last three years are shown
in the table below.
2019-20
£m
2018-19
£m
2017-18
£m
Nuclear Decommissioning Authority
6,751
(99,592)
73,218
Science and research
7,785
7,511
6,740
Contracts for Difference
3,543
(2,971)
3,558
UK Research & Innovation (Innovate UK)
1,077
1,052
973
Coal Authority
58
(1,993)
1,545
Green Investment Bank and Green Infrastructure Platform
9
11
24
Renewable Heat Incentive
846
818
687
International Climate Finance
339
321
330
Post Office
92
228
140
Redundancy payment service
431
319
260
COVID-19 business support
10,976
–
–
Green Investment Bank sale receipts
–
–
(1,621)
Other
1,937
75
179
Total
33,844
(94,221)
86,033
In 2019-20, there has been a high variation on expenditure recognised in the financial statement from
(£94.4 billion) in 2018-19 to £33.5 billion in 2019-20. This has been primarily driven by a small change
in discount rates in 2019‑20 compared to the change in discount rates between 2018-19 and 2017-
18, which resulted in (£99.6 billion) movement in the NDA’s nuclear decommissioning provision being
recognised in 2018-19. 2019-20 includes the cost of the COVID-19 business support grants of
£11.0 billion. 2019-20 has also seen an increase in the Contracts for Difference (CFDs) fair value
movement and net £6.8 billion movement in the NDA’s nuclear decommissioning provision. 2019-20
– Other category includes the in year funding to the Official Receiver in respects of British Steel
Limited, expenditure incurred by the British Business Bank and expenditure relating to the restarted
Capacity Market Payment Scheme. Spending on areas such as UK Research & Innovation (Innovate
UK), and International Climate Finance have remained broadly consistent.

31
Performance report
CFDs and Capacity Market Payments
The increase in the estimated discounted value
of CFD payments (excluding HPC) from
(£12.9 billion) in 2018-19 to (£16.5 billion)
in 2019-20 resulted in a £5.3 billion expense
reported in the SoCNE which is off set by
payments of (£1.8 billion). The increase is mainly
due to the award of 22 further CFDs in October
2019 as a result of Allocation Round 3 and the
updated forecast of the wholesale electricity
prices that are expected to be achieved by
generators, offset by payments made during
the year 2019-20.
During the year, the European Commission (EC)
conducted an investigation into the GB Capacity
Market, resulting in the scheme being deemed
State Aid compliant. This resulted in the
Electricity Settlements Company and National
Grid to restart their respective Capacity Market
activities. This resulted in £1.5 billion of Capacity
Market payments being made in 2019-20
compared to £0.2 billion in 2018-19. These
payments are off-set by the recognition of levy
income.
Discount rates
In 2018-19 the provision expense reported in the
Statement of net expenditure, was (£97.7 billion)
which was primarily driven by the reduction in
discount rates prescribed by HM Treasury from
(1.56%) in 2017-18 to (0.11%) in 2018-19.
In 2019-20, the equivalent real discount rate
for cash outflows expected after ten years
prescribed by HM Treasury has reduced further
to (0.01%) this resulted in a smaller change
recognised in the SoCNE in 2019-20 of
(£0.2 billion) compared to (£9.6 billion) in 2018-
19 relating to the nuclear decommissioning
provision. In 2019-20, in addition to the impact
of the discount rate change, the nuclear
provision liability has increased by £6.9 billion
due to cost estimate changes. Further detail of
the movements in provisions can be found in
note 18.1 for Nuclear provisions and note
18.2 for Other provisions.
Comparison of Outturn to Budget
Outturn
£m
Variances
Budget
£m
£m

%
TME
33,844
31,168
(2,676)
(8.6%)
Resource DEL
2,838
3,555
717
20.2%
Capital DEL
11,228
11,835
607
5.1%
Total DEL
14,066
15,390
1,324
8.6%
Resource AME
19,915
15,055
(4,860) (32.3%)
Capital AME
(137)
723
860 119.0%
Total AME
19,778
15,778
(4,000) (25.4%)
The variances are the TME (Voted and Non-
Voted) against Budget (Voted and Non-Voted),
this is different to the presentation in the SoPS
which compares Voted Expenditure against
Voted Budget. Explanations for the key variances
from budget are as follows, split by budget line
headings from the SoPS.
TME
Our TME budget was £31.2 billion; against this
the Department had an Outturn of £33.8 billion.
The Department spent an additional £2.6 billion
in excess of its Budget. This has resulted in the
Department breaching its control total and
receiving a regularity audit qualification; this was
due to the recognition of COVID-19 business
support grants in 2019-20.
Resource DEL
The Estimate was £3.6 billion. Outturn against
the Estimate was £2.8 billion; £717m lower than
budget. This is primarily due to contingency not
required following the successful sale of British
Steel Limited which completed in March 2020.

32
Annual report and accounts 2019-20
Capital DEL
The Estimate was £11.83 billion. Outturn against
the Estimate was £11.2 billion, £607 million lower
than budget. A significant proportion of the
underspends is attributed to fewer capital calls
by financial institutions under the Enterprise
Financial Guarantees schemes operated by the
British Business Bank on behalf of the Core
Department. The extent of annual capital calls is
not wholly predictable, as it is intrinsically linked
to the financing needs of the underlying
business.
Resource AME
The Estimate was £15.1 billion, and Outturn was
£19.9 billion, exceeding the Estimate by £4.9
billion, due to the recognition of a £10.8 billion
provision for the cost of the government’s
COVID-19 business support grants, which is
off-set by underspends, principally due to
accounting valuation adjustments, including:
• The NDA’s nuclear decommissioning provision
primarily increased by changes in cost
estimates, which were £1.4 billion less than
the Estimate, which reflect uncertainties when
budgeted for the provision.
• CfD liabilities, which increased by £3.6 billion,
from (£12.9 billion) to (£16.5 billion). This was
£3.1 billion lower than the Estimate due to
budgetary contingency in the forecast of the
wholesale electricity prices.
• A potential provision relating to the Official
Receiver of £1.1 billion was not required.
Resource AME – Excess Vote
The sudden and serious adverse impacts on
society and the economy of the COVID-19
pandemic necessitated an urgent Government
response including announcements in March of
two schemes to provide grant support to
businesses affected by the crisis. These
announcements along with actions taken by the
Department to ensure these cash grants were
paid to eligible businesses as soon as possible,
had the effect of creating a constructive
obligation on the Department and a provision for
£10.8 billion has been reported in note 18 of the
accounts. At the time of the announcements
and subsequent actions, there was insufficient
time to request increased budgetary cover
through a Supplementary Estimate for this
non-cash expenditure and, as a result, the Voted
Resource AME control total has been exceeded
by £4.9 billion resulting in a qualified audit
opinion on regularity and an Excess Vote.
Capital AME
The £860 million underspend on capital AME is
almost entirely due to lower than expected
demand by Post Office Limited for its working
capital funding from the Core Department at the
year-end.

33
Performance report
Expenditure on Official Development
Assistance
Official Development Assistance (ODA) is
government aid that targets economic
development in developing countries. ODA
spend is reported on a cash basis and for the
calendar year.
Our total ODA spend in 2019 was £957.4 million
– £622.5 million on R&I, and £334.9 million on
climate and energy. To maximise effectiveness,
we aim to monitoring, evaluation and learning to
identify opportunities for improvement.
R&I ODA activities in 2019-20
On R&I, we:
• launched 12 pioneering research hubs for
research into complex development problems;
• supported the first cohort of African
Independent Research Fellows to establish
independent careers;
• celebrated five years of the Leaders in
Innovation Fellowship which has supported
over 1000 innovators to commercialise
innovations; and
• The Newton Prize awarded funding to
research projects in environmental
conservation and strengthening energy
infrastructure to withstand extreme weather.
Climate and energy ODA activities in 2019-20
On climate and energy, we spent:
• £166.5m to support delivering breakthrough
energy storage solutions at scale in developing
countries;
• £20m to support small scale renewable energy
projects in sub-Saharan Africa;
• £12.5m to boost the uptake of greener
construction practices; and
• £9.4m for technical assistance and grants to
support new business models that can
transform supply chains at risk from
deforestation.
BEIS ODA spend by sector
Sector
code
Sector
2019
£m
111
Education, Level Unspecified
51.6
112
Basic Education
2.3
114
Post-Secondary Education
9.1
121
Health, General
116.0
122
Basic Health
1.2
123
Non-communicable diseases
0.8
130
Population Policies/Programmes &
Reproductive Health
0.5
140
Water and supply sanitation
2.2
151
Government & Civil Society-general
5.2
152
Conflict, Peace & Security
2.0
160
Other Social Infrastructure & Services
4.6
210
Transport & Storage
0.8
220
Communications
0.2
231
Energy Policy
18.0
232
Energy generation, renewable
sources
222.6
240
Banking & Financial Services
0.1
250
Business & Other Services
0.1
311
Agriculture
57.9
312
Forestry
15.8
313
Fishing
1.9
321
Industry
20.5
322
Mineral Resources & Mining
2.1
323
Construction
0.2
410
General Environment Protection
122.6
430
Other Multisector
273.9
720
Emergency Response
0.2
740
Disaster Prevention & Preparedness
1.3
910
Administrative Costs of Donors
23.6
998
Unallocated/unspecified
0.1

Total
957.4
Notes
1
The BEIS ODA spend for 2019 provided are provisional.
The final official statistics will be published by the Department
for International Development in November 2020.
2
Sector codes used by the OECD Development Assistance
Committee (DAC): http://www.oecd.org/

34
Annual report and accounts 2019-20
Consolidated Statement of
Financial Position
The Department remains in a net liability position
as at 31 March 2020. The liability has increased
from (£139 billion) at 31 March 2019 to
(£158 billion) at 31 March 2020. The most
significant assumptions and items impacting the
Statement of Financial Position are explained
below. They include
a. Contracts for Difference (CfDs) and
recognition of Hinkley Point C (HPC);
b. Impact of changes in discount rates;
c. Nuclear Decommissioning provision, and
d. COVID-19 business support provision.
(a) Contracts for Difference and recognition
of Hinkley Point C
CfDs are designed to incentivise investment in
a mix of low carbon electricity generation
technologies which will help the UK meet its
renewable and decarbonisation targets.
CfD contracts do this by agreeing with a
generator a strike price for electricity supplied,
thereby providing certainty needed for private
investment, while protecting consumers from
having to continue to pay higher support costs
when electricity prices are high. The support
payments paid (or repaid) in future will be
calculated from the difference between the
‘strike’ price and the average market price.
Low Carbon Contracts Company (LCCC)
Difference payments under the CfDs are funded
through a levy paid by licensed energy suppliers.
The LCCC is the company established by
Government to collect this levy, manage the
CfDs and pay or receive the contracted
difference payments. The LCCC is managing all
73 CfD contracts.
Accounting for fair value
In order to comply with the relevant accounting
standards, the Department is required to
estimate the ‘fair value’ of future CfD payments.
Difference payments under CfDs can be positive
(an asset) or negative (a liability) and are currently
recognised as a liability. The matching asset
arising from the statutory obligation on suppliers
is not recognised under the FReM. The CfD
liability figure is calculated using a model that
estimates eligible generation, by CFD holders
and combines this with forecast expected
demand for electricity and electricity prices over
the term of the contract (which are affected by a
large number of factors including forecast
expected generation mix and demand for
electricity). The figures in the financial statements
represent management’s best current estimate
within a range of scenarios and will be subject to
change over time.
• In accordance with accounting standards the
initial fair value of any contract is deferred
i.e. not recognised in the accounts. As at 31
March 2020, the cumulative value of the
deferred differences of the CfDs (excluding
HPC) was (£22.3 billion) and (£73.1 billion)
(including HPC) (31 March 2019: (£23.3 billion)
(excluding HPC)).
• The Department recognises all subsequent
movements of fair value on CfD contracts,
whose cumulative value was (£89.6 billion)
(including HPC) at 31 March 2020 (31 March
2019: (£35.2 billion)) through the Statement of
Comprehensive Net Expenditure.
• The Department recognises a liability, which
was (£16.5 billion) as at 31 March 2020
(31 March 2019: (£12.9 billion)) on the
Statement of Financial Position.
The tables below show movements in the year.
Further details on the CfDs are in the note 9 to
the financial statements.
HPC
During the current year, as explained further in
note 1.26, BEIS updated its Dynamic Dispatch
Model to estimate wholesale electricity prices out
to 2060. As a result, it is considered that the
criteria for recognition have been met and
accordingly HPC CFD has been recognised in
the financial statements for the first time in
2019-20. At 31 March 2020 the deferred value of
HPC was £50.8 billion. See note 9 for further
information.

35
Performance report
Effect on the Statement of Financial Position
2019-20
£bn
2018-19
£bn
01-Apr
12.9
15.9
Changes in FV on exiting
recognised contracts
4.4
(2.7)
Release of CfD liability
relating to terminated
contracts
–
–
Payments made to
generators
(1.7)
(1.0)
Deferred differences
recognised
0.9
0.7
31-Mar
16.5
12.9
Movements in fair value

2019-20
£bn
2018-19
£bn
01-Apr
35.2
39.2
Changes in fair value on
exiting recognised contracts
4.4
(2.7)
Additions
0.9
–
Recognition of HPC CFD
during the year
50.8
–
Release of CfD liability
relating to terminated
contracts
–
(0.3)
Payments made to
generators
(1.7)
(1.0)
31-Mar
89.6
35.2
Effect on the Statement of Comprehensive Net
Expenditure

2019-20
£bn
2018-19
£bn
Contract for difference
derivatives
5.3
(2.0)
comprising:

Changes in FV on exiting
recognised contracts
4.4
2.7
Release of CfD liability
relating to terminated
contracts
–
–
Deferred differences
recognised
0.9
0.7
(b) Impact of changes in discount rates
Discount rates
Some of our priorities carry obligations that are
very long-term and will involve expenditure over
decades to come. The eventual costs of these
long-term projects are uncertain but we are
required to present a single number in the annual
accounts. This single number is based on our
best estimate of costs, technology and other
relevant factors, adjusted to reflect the changing
value of money over time.
The worth of the Department’s future cash flows
are calculated at present value in accordance
with accounting standards. This present value
reflects the time value of money. The accounts
use a number of different discount rates
depending on the nature of the transaction and
the regulation applicable.
In the past, the time value of money has usually
been positive which means money could be
invested in the present for a return in the future
that would exceed the rate of inflation – this is
known as a positive ‘real’ return. Government
bonds are seen as a low risk form of
investments. Usually, therefore, government
bonds bring a lower rate of return than other
investments. As bonds pay a fixed cash amount
when they mature, the higher the price paid for
the bonds now, the lower the rate of return is
considered to be. Following the global financial
crisis, demand for lower–risk investments
increased, particularly government bonds. As a
result, the price of government bonds rose.
This has resulted in government bonds providing
a negative ‘real’ return. The long-term discount
rate has been negative since 2015. In 2019-20,
the long term discount rate remains negative but
not to as significant extent as in prior years.
When negative discount rates are applied to the
Department’s long-term obligations, this has the
effect of significantly increasing the reported
value of the liabilities, however, with the decrease
of the negative discount rate this has resulted in
a decrease in the report value of the liabilities
this year. Even when the cash the Department
expects to pay has not changed substantially,
year on year. But not all rates are negative.

36
Annual report and accounts 2019-20
For investment appraisal government continues
to use positive rates, to ensure that projects are
correctly appraised and generate future benefits.
These accounts use positive discount rates to
determine the present value of future income
generated from assets and investments.
When positive rates have been used to discount
future cash receipts, then the present value of
them is lower than the cash the Department will
receive. The following tables set out the specific
material balances in our accounts that have been
discounted. The impact of the discounting can
be assessed by comparing the discounted value
with the undiscounted value.
Impact on assets
Assets have been discounted at positive rates.
This means that the present value is lower than
the cash the Department expects to receive.
For financial instruments we are required to use
the prescribed HM Treasury discount rate of
0.7% real and 3.7% nominal, or the rate of return
implicit in the contract if higher. For the repayable
launch investments, we assessed the implicit
rate to be 3.5% plus RPI; 2019-20: RPI was
3.35% (2018-19: RPI was 2.6%) giving an
implicit rate of 6.85% (2018-10: 6.10%).
Impact on liabilities
Liabilities continue to be discounted at a negative
rate in 2019-20. The present value of the
liabilities is therefore higher than the value the
Department expects to pay in the future.
The discount rate has been negative since 2015
because return on government bonds has been
lower than inflation due to increased demand for
government bonds since the financial crisis.
The specific assets and liabilities that have
been discounted are shown the in table below.
Provisions from the NDA and the Coal Authority
relate to the expected future cost of managing
the energy legacy. The fair value of the CfD has
been adjusted using the 0.7% real term
discount rate.

2019-20
2018-19 Rationale
Nuclear decommissioning provisions

Short term < 2 years
-1.36%
-1.22%
Set by HM Treasury Public
Expenditure System (PES) Secretariat
7 December 2019
Short term 2 – 5 years
-1.46%
-1.31%
Medium-term 6 -10 years
-1.42%
-0.94%
Long-term > 10 years
-0.01%
-0.11%
CfD financial instruments

Real rate (as cashflows are in real terms)
0.70%
0.70%
as above
Coal pensions

Real rate + 3% RPI (as contractual figures are
in nominal values)
3.7%
3.70%
as above: financial instruments discount
rate (non-indexed)
Repayable launch investments

Higher of the implicit rate of return or the
financial instrument’s rate
3.50%
RPI 3.35%
3.50%
RPI 2.60%
Risk-free rate for government investment
appraisal set by HM Treasury Green
Book, adjusted for inflation
Notes
1
HM Treasury provided nominal and Inflation rates for discounting provisions for 2018-19, rather than Real rates as they have in prior
years. The values above are real rates for 2019-20 and 2018-19 taking into account the nominal and inflation rates for 2019-20 and
2018-19. Further details of the nominal and inflation rates are given in the Departmental Group Accounting Policies note 1.23

37
Performance report
The impact of discounting
2019-20
With
discounting
£m
2019-20
Without
discounting
£m
2019-20
Impact of
discounting
£m
2018-19
With
discounting
£m
2018-19
Without
discounting
£m
2018-19
Impact of
discounting
£m
Assets
Repayable launch
investments
833
1,098
(265)
1,058
1,348
(290)
Coal pensions
808
916
(108)
920
1,058
(138)
Liabilities
NDA nuclear provision
134,677
131,864
2,813
129,709
123,311
6,398
Coal Authority provision
2,306
2,275
31
2,299
2,174
125
Financial instruments
CfD liability
85,583
100,903
(15,320)
35,249
37,176
(1,927)
(c) NDA provisions
NDA manage the clean-up and decommissioning
of 17 nuclear licensed sites across the UK – such
as former nuclear power stations and research
centres. Some of these sites date from the
earliest days of nuclear power. Unlike modern
nuclear facilities, decommissioning of these sites
was not built into plans or designs.
Decommissioning of sites will take many
decades. In part, this is because plans often
include periods of ‘care and maintenance’,
where sites are made safe and put into an
interim state, allowing residual amounts of
radioactive material to decay over time. By doing
this, the final stages of decommissioning will be
easier and safer to complete.
NDA’s best estimate of the future costs of the
estate over the next 100+ years on an
undiscounted basis is £132 billion.
This figure is based on dealing with an assumed
inventory of materials with varied radiological
characteristics and using the extant strategy for
retrieval and disposal of the resulting materials
over several decades. Each of these elements is
uncertain in its own right – the cost of developing
the necessary technology and plants to deal with
these activities is also uncertain. The quality of
the forecast becomes less certain the longer the
projection.
NDA has reviewed the methodologies used
in the calculation, taking into account
HM Treasury Green Book guidance and the need
to remove optimism bias. Projects like these
could typically have a range of estimates from
-50% to +300%. In light of uncertainties in the
estimate, NDA considers it prudent to present
a credible range of outcomes. The range
presented for the current year is for
undiscounted costs of £115 billion to
£246 billion.
(d) COVID-19 business support grant
provision
As detailed in the note 1.26 the government’s
COVID-19 business support grants have been
recognised in 2019-20, resulting in a provision
for £10.8 billion being recognised in note 18.2.
These grants have been paid out in 2020-21,
clearing the liability.
NDA provision: forecast undiscounted expenditure
0
500
1,000
1,500
2,000
2,500
3,000
3,500
2021
2031
2041
2051
2061
2071
2081
2091
2101
2111
2121
2131
2141
£ million
Sellaﬁeld
Rest of programme

38
Annual report and accounts 2019-20
This figure is based on dealing with an assumed
inventory of materials with varied radiological
characteristics and using the extant strategy for
retrieval and disposal of the resulting materials
over several decades. Each of these elements is
uncertain in its own right – the cost of developing
the necessary technology and plants to deal with
these activities is also uncertain. The quality of
the forecast becomes less certain the longer the
projection.
NDA has reviewed the methodologies used
in the calculation, taking into account
HM Treasury Green Book guidance and the need
to remove optimism bias. Projects like these
could typically have a range of estimates from
-50% to +300%. In light of uncertainties in the
estimate, NDA considers it prudent to present
a credible range of outcomes. The range
presented for the current year is for
undiscounted costs of £115 billion to
£246 billion.
(d) COVID-19 business support grant
provision
As detailed in note 1.26 the government’s
COVID-19 business support grants have been
recognised in 2019-20, resulting in a provision
for £10.8 billion being recognised in note 18.2.
These grants have been paid out in 2020-21,
clearing the liability.

39
Performance report
Sustainability report
Introduction
We are committed to sustainability in the way we
make policy, procure goods and services and
impact the environment.
As part of our commitments to environmental
sustainability, we take part in the Greening
Government Commitments (GGC). In line with
GGC, we report on our greenhouse gas
emissions, waste arising, and water and paper
use in this report.
Sustainability in policy development
Rural proofing
Rural proofing is about recognising the impact of
our policies in rural areas, to ensure policy
outcomes are fair and reasonable in these areas.
The Cities and Local Growth Unit (CLGU) works
to encourage economic growth and productivity
in all parts of England, Towns in rural areas,
such as Bloxwich and Todmorden are being
supported to develop Town Deals. Rural
coastal towns have received the Coastal
Communities Fund.
Climate change adaptation
Climate change adaptation refers to adapting to
the consequences of climate change. We
contribute to the cross-government National
Adaptation Plan, published every 5 years. It sets
out how risks of extreme weather events will be
managed (e.g. flood resilience measures) for
communities, the built environment, businesses
and local government.
Sustainable procurement
Suppliers
We use Crown Commercial Service frameworks
to procure our goods and services. The
procurement service works with its partners
to ensure sustainability goals are achieved.
Engagement with small and medium enterprises
We have achieved the government target of 33%
direct procurement and through the supply chain
two years ahead of schedule. We continue to
promote opportunities with SMEs through open
competition, early market engagement and use
of government frameworks wherever we can.
Prompt payments
It is government policy to pay 90% of undisputed
invoices within 5 days, with the remainder paid in
30 days. In 2019-20, the Core Department paid
94.3% of undisputed invoices within 5 days and
99.1% within 30 days.
The most common reasons for invoices to be
unpaid within 30 days are due to: amounts on
the purchase order not matching the receipt,
or a supplier has used a different address or
bank details, which does not match the invoice.
These issues need to be resolved before
payments are made.
Environmental sustainability
Green Guardians
Our Green Guardians network, a group of staff
volunteers, supports BEIS in achieving its
environmental sustainability targets through
being a strong staff engagement channel on
initiatives that support our GGC targets.
Greenhouse gas emissions
We continue to make significant progress in
reducing our greenhouse gas emissions, in line
with the targets set by the GGC, through
consolidation of our estate and energy
efficiency improvements.
Waste
We have fully segregated our waste streams by
installing bins for recycling a variety of materials.
We have also eradicated the majority of
consumer single use plastics throughout the
Department.

40
Annual report and accounts 2019-20
Water & paper
We are accredited to ISO 50001 (energy
efficiency) and ISO1400 (waste management).
We are reviewed annually against these
standards and we will seek continuous
improvement in both. We have a closed paper
cycle whereby all paper is recycled for reuse.
Food and catering
We are committed to sustainable, and where
possible, British food products, and have
eliminated single use plastics from our catering
provision.
Sustainable construction
We have had no new builds in the last year.
We work with the Government Property Agency
who hold our leases to ensure any construction
work prioritises sustainability and reaches the
government’s buying standard.
Biodiversity & the natural environment
We have no significant impact on biodiversity.
HMLR continues to work with FM providers on
a phased plan to improve the biodiversity at all
sites appropriate for such activity; in the past
year this has been achieved at Hull and Fylde
with plans for Durham and Plymouth
progressing.
At Hull and Fylde, HMLR have built on the
existing landscape and vegetation to increase
the sites’ biodiversity value. Vegetation and
habitats that support native species of plants
and invertebrates have been prioritised and
nurtured, whilst new plants and bug houses have
been added to support the habitats.
Summary of progress on Greening Government Commitments
Targets by 2019-20
compared to the 2009‑10
Baseline
Progress in 2019-20
Total GHG Emissions
reduce by 66%1
71% reduction
Number of domestic flights
reduce by 30%
71% reduction
Total non-hazardous waste arising
reduce generally
73.68% increase
Waste to landfill
reduce proportion to 10%
reduced to 4.57% in 2019-20
Waste recycled, reused,
composted
increase generally
68.27% increase
Volume of water used
reduce generally
55.63% reduction
Reams of paper procured
reduce by 50%
83.29% reduction
Notes
1 66% is the new 2020 target for BEIS. The original target of 40% has been exceeded; in 2016-17,
we had achieved 51% reduction. Further information is available at the GGC page on gov.uk.

41
Performance report
Reporting on Greening Government Commitments
Greenhouse gas emissions
2019-2020
2018-2019
2017-18
2016-17
Baseline
2009-10
Emissions, tonnes CO2e
Scope 11
4,730
6,644
8,007
6,109
17,837
Scope 22 and 33
13,905
16,037
22,325
25,480
46,507
Total
18,634
22,681
30,332
31,589
64,344
Related energy consumption, MWh
Electricity: non-renewable
14,242
28,661
29,221
30,360
45,324
Electricity: renewable
15,968
15,596
17,429
19,541
38,676
Gas
11,282
20,347
36,186
29,071
62,905
District heating
24
114
149
125
–
Other heat
802
9,210
6,824
2,664
9,865
Total
42,318
73,928
89,809
81,761
156,770
Related expenditure, £’000
Energy
7,349
7,460
6,755
6,467
n/a
CRC licence4
n/a
298
598
497
n/a
Official business travel5, 6
13,035
16,907
7,559
11,660
n/a
Total
20,384
21,015
14,912
18,624
n/a
Domestic business flights
2019-2020
2018-2019
2017-18
2016-17
Baseline
2009-10
Total number of domestic flights7
3,860
4,503
2,689
5,125
8,078
Waste
2019-2020
2018-2019
2017-18
2016-17
Baseline
2009-10
Total waste generated, tonnes
1,971
2,137
2,468
2,159
7,541
Non-hazardous: to landfill
90
300
289
197
2,986
Non-hazardous: reused/ recycled
1,248
1,293
1,779
1,775
4,107
Non-hazardous: composted/
bio-digestion
63
79
49
60
25
ICT waste: reused
2
–
–
–
7
ICT waste: recycled
36
30
11
51
2
Incinerated: e.g. food waste
532
536
389
181
448
Total disposal cost, £’000
553
404
468
432
n/a
Water and paper
2019-2020
2018-2019
2017-18
2016-17
Baseline
2009-10
Water consumption, m3
125,774
115,907
110,457
126,468
283,495
Water supply and sewage costs, £’000
461
489
325
329
n/a
Paper procured, reams
47,509
71,335
61,825
97,893
441,134
Notes
Entities include: i. BEIS Core Department, ii. Companies House, iii. Intellectual Property Office, iv. Land Registry, v. Natural Environment
Research Council, vi. Nuclear Decommissioning Authority, and vii. Ordnance Survey
1
Scope 1: direct emissions from sources owned or controlled
2
Scope 2: indirect emissions from consumption of purchased electricity or sources of energy generated upstream
3
Scope 3: other indirect emissions occurring as a consequence of BEIS’ operations, but not directly owned or controlled by BEIS
4
CRC ended in 2018-19
5
2018/19 expenditure on official business travel data has been updated to include Land Registry and some data for IPO not previously
captured.
6
Expenditure on official business travel for NERC does not include international flights
7
Domestic flight figures for 2018-19 and 2019-20 now count each part of a return journey as one flight, in line with the GGC reporting
requirement. In previous years, a return journey counted as one flight.
8
Some data for March 2020 has been estimated (in line with reporting guidance methodologies) due to issues posed by COVID-19

42
Annual report and accounts 2019-20
Other performance reporting
Anti-bribery and anti-corruption
No cases of bribery or corruption were identified
within BEIS this year.
We have continued to work with other
departments and organisations to maintain
standards and implement best practice. Our
policy on gifts, hospitality and bribery and
corruption has been refreshed and updated. A
standard template Gifts and Hospitality register
has been produced for each directorate to
record gifts and hospitality over a value of £15
and any reciprocal gifts given. These registers
are reviewed by the BEIS Counter Fraud team.
We have ongoing collaboration with other
government departments on high risk areas such
as overseas funding, and we have continued to
manage risks with an internal dimension and
those involving overseas delivery partners.
Fraud, anti-bribery and corruption awareness
continues to be promoted by the BEIS Counter
Fraud team, through workshops, network
meetings and the availability of training.
This includes mandatory training for front-line
staff and managers in high risk areas. We have
seen an increase of nearly 20% in training
uptake. Communications activity is ongoing –
the national “Take Five – To Stop Fraud”
campaign messaging has been adopted both
internally and with BEIS partner organisations.
Public correspondence
13.8
11.1
6.8
3.6
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
No. of written enquiries received
% with response within 15 days
324
341
625
385
349
413
452
397
211
349
324
929
90%
81%
84%
90%
71%
88%
90%
92%
96%
84%
94%
89%
83%
We aim to respond to 80% of our
correspondence within 15 working days.
In 2019-20, we received 5,099 written enquiries
from members of the public. and responded
to 87% of cases within 15 working days.
The graph shows our monthly performance.

43
Performance report
Advertising campaigns
Our communications directorate contributes to the successful delivery
of major policy areas. We communicate through a range of marketing,
press and public relations, digital and internal channels and partnership
activities that are insight driven and robustly evaluated. We do, where
necessary, engage in publicity and advertising to draw attention to
important campaigns with the right audiences.
In 2019-20 we ran advertising campaigns to support business growth
including advertising to support businesses to prepare for Brexit as part
of the Cabinet Office ‘Get Ready’ campaign, workers on national and
living wage and to help future proof skills relevant to the engineering
industry.
Complaints to the Parliamentary
Ombudsman
No. complaints accepted for
investigation
6
(a) Investigations fully upheld
0
(b) Investigations partly upheld
3
(c) Investigations not upheld
4
Note
Figures for (b) and (c) may include complaints accepted in earlier
years.
These figures have been obtained directly from
the Parliamentary and Health Service
Ombudsman for the period 2018-19, and
provide the most recent data available. Neither
the 2018-19 nor the 2019-20 Parliamentary
Complaints Statistics reports have been
published.
The Ombudsman only accepts complaints that
have been through the BEIS internal complaints
process. We aim to answer all formal complaints
via xxx@xxx.xx within 20 working
days. Only a small percentage of complaints we
receive are escalated to the Ombudsman.
GOVERNMENT
SUPPORT CAN
HELP YOUR
BUSINESS
GROW
From help with finance to
business mentoring, visit
businesssupport.gov.uk
Hannah Woodgates
Owner of Hannah Woodgates
Hair Design and recipient of funding
through the British Business Bank
Sarah Munby
Permanent Secretary and
Principal Accounting Officer
11 September 2020

44
Annual report and accounts 2019-20
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Accountability
report

46
Annual report and accounts 2019-20
Corporate governance report
Statement of Accounting Officer’s
responsibilities
Under the Government Resources and Accounts
Act 2000 (the GRAA), HM Treasury has directed
the Department for Business, Energy and
Industrial Strategy to prepare, for each
financial year, consolidated resource accounts
detailing resources acquired, held or disposed
of, and the use of resources, during the year by
the Department (inclusive of its Agencies) and its
sponsored non-departmental public bodies and
other arm’s-length public bodies designated by
order made under the GRAA by Statutory
Instrument 2020 no 17 (together known as the
‘Departmental Group’, consisting of the Core
Department and sponsored bodies listed at note
28 to the accounts). The accounts are prepared
on an accruals basis and must give a true and
fair view of the state of affairs of the Department
and Departmental Group, and of the income and
expenditure, Statement of Financial Position and
cash flows of the Departmental Group for the
financial year.
In preparing the accounts, the Accounting
Officer of the Department is required to
comply with the requirements of
Government Financial Reporting Manual
and in particular to:
• observe the Accounts Direction issued by the
Treasury, including the relevant accounting and
disclosure requirements, and apply suitable
accounting policies on a consistent basis;
• ensure that the Department has in place
appropriate and reliable systems and
procedures to carry out the consolidation
process;
• make judgements and estimates on a
reasonable basis, including those judgements
involved in consolidating the accounting
information provided by non-departmental and
other arm’s-length public bodies;
• state whether applicable accounting
standards as set out in the Government
Financial Reporting Manual have been
followed, and disclose and explain any
material departures in the accounts;
• prepare the accounts on a going concern
basis;
• confirm that the Annual Report and Accounts
as a whole is fair, balanced and
understandable and take personal
responsibility for the Annual Report and
Accounts and the judgements required for
determining that it is fair, balanced and
understandable.
HM Treasury has appointed the Permanent
Head of the Department as Accounting
Officer of the Department for Business,
Energy and Industrial Strategy.
The Accounting Officer of the Department has
also appointed the Chief Executives (or
equivalents) of its sponsored non-departmental
and other arm’s length public bodies as
Accounting Officers of those bodies.
The Accounting Officer of the Department is
responsible for ensuring appropriate systems
and controls are in place to ensure any grants
the Department makes to its sponsored bodies
are applied for the purposes intended and that
such expenditure and the other income and
expenditure of the sponsored bodies are properly
accounted for, for the purposes of consolidation
within the resource accounts. Under their terms
of appointment, the Accounting Officers of the
sponsored bodies are accountable for the use,
including the regularity and propriety, of the
grants received and the other income and
expenditure of the sponsored bodies.

47
Accountability report
The responsibilities of an Accounting Officer,
including responsibility for the propriety and
regularity of the public finances for which the
Accounting Officer is answerable, for keeping
proper records and for safeguarding the assets
of the Department or non-departmental or other
arm’s length public body for which the
Accounting Officer is responsible, are set out in
Managing Public Money published by
HM Treasury.
Accounting Officer’s confirmation
As Accounting Officer, I have taken all the steps
I ought to have taken to make myself aware of
any relevant audit information and to establish
that the Department’s auditors are aware of that
information. So far as I am aware, there is no
relevant audit information of which the auditors
are unaware.
Sarah Munby
Permanent Secretary and
Principal Accounting Officer
11 September 2020

48
Annual report and accounts 2019-20
Directors’ report
The directors’ report includes individuals who have had responsibility for BEIS during the year, and up
to the reporting date. Senior officials comprise members of the Executive Committee.
Ministers
Rt Hon
Rt Hon
Nadhim Zahawi MP
Amanda Solloway MP
Alok Sharma MP
Kwasi Kwarteng MP
from 26 Jul 2019
from 14 Feb 2020
from 14 Feb 2020
from 24 Jul 2019
Parliamentary Under
Parliamentary Under
Secretary of State
Minister of State
Secretary of State
Secretary of State (Minister
for Business, Energy, and
(Minister for Business,
(Minister for Business and
for Science, Research, and
Industrial Strategy
Energy and Clean Growth)
Industry)
Innovation)
Paul Scully MP
Lord Callanan
Lord Grimstone
from 14 Feb 2020
from 14 Feb 2020
from 18 Mar 2020
Parliamentary Under
Parliamentary Under
Minister for Investment
Secretary of State (Minister
Secretary of State (Minister
(jointly with the Department
for Small Business,
for Climate Change and
for International Trade)
Consumers and Labour
Corporate Responsibility)
Markets)
Senior officials
Sarah Munby
Julian Critchlow
Joanna
Jo
Jaee Samant
Professor John
from 20 Jul 2020
Director General
Whittington
Shanmugalingam
Director General
Loughhead
Permanent
Director General
from 15 Jul 2019
Director General
Secretary1
Director General
Tom Taylor
Craig Woodhouse Ashley Ibbett
Mike Keoghan
Chris Thompson
Doug Watkins
Chief Financial
from 15 Jul 2019
from 14 Apr 2020
from 14 Apr 2020
from 14 Apr 2020
from 13 Jul 2020
Officer; Director
Director
Director General
Director
Director
Acting Director
(interim)
General (interim)
previously a Director
1 Sarah Munby was a Director General from 15 July 2019 to 20 July 2020, when she was appointed the Permanent Secretary taking over
from Sam Beckett who was the Acting Permanent Secretary from 14 April 2020 to 19 July 2020.

49
Accountability report
Non-executive directors
Archie Norman
DB, Lead
non-executive
Nigel Boardman
DB,
ARAC Chair
Leena Nair
DB,
NOMS Chair
Stephen A.
Carter
DB
Carolyn McCall
DB
Kathryn Parsons
DB
Stuart
Quickenden
DB
ARAC
Elaine Clements
from 10 Apr 2019
ARAC
Louise Fisher
NOMS
Bryan Ingleby
ARAC
Adrian
Kamellard
from 10 Apr 2019
ARAC
Catherine
Pridham
PIC
Leavers
Those who left ministerial, executive, and non-executive positions during the year
Ministers
Rt Hon Greg
Rt Hon Claire
Rt Hon Chris
Andrew
Rt Hon
Rt Hon
Rt Hon
Clark MP
Perry MP
Skidmore MP
Stephenson MP
Jake Berry MP
Lord Henley
Jo Johnson MP
To 24 Jul 2019
To 24 Jul 2019
To 25 Jul 2019;
From 04 Apr to
From 07 Jun to
To 26 Jul 2019
From 24 Jul to
Secretary of State Minister of State
then from 10 Sep
25 Jul 2019
25 Jul 2019
Parliamentary
05 Sep 2019
for Business,
for Energy and
2019 to
Parliamentary
Parliamentary
Under Secretary
Minister of State
Energy, and
Clean Growth
13 Feb 2020
Under Secretary
Under Secretary
of State
for Universities,
Industrial Strategy
Minister of State
of State, Minister
of State, Minister
Science, Research
for Universities,
for Business, and
for Northern,
and Innovation
Research, and
Industry
Powerhouse and
Innovation
Local Growth
Kelly Tolhurst
Rt Hon Andrea
Lord Duncan
MP
Leadsom MP
From 26 Jul 2019
To 13 Feb 2020
From 24 Jul 2019 to 13 Feb 2020
Parliamentary
to 13 Feb 2020
Parliamentary
Under Secretary of Secretary of State Under Secretary
State, Minister for for Business,
of State
Small Business,
Energy, and
Senior officials
Consumers and
Industrial Strategy
Corporate
Responsibility
Senior officials
Gareth Davies Gavin
Sam Lister
Nick Chism
Alex Chisholm Caleb Deeks
Sarah Harrison Sam Beckett
To 03 May 2019
Lambert
Interim, from
To 05 Feb 2020 To 09 Apr 2020 To 09 Apr 2020 To 10 Jul 2020
To 24 August
Interim from
15 Apr to
Permanent
2020
15 Apr to
12 Jul 2019
Secretary
12 Jul 2019
Non-executive directors
Claire Davies
Myriam Madden
To 1 Jun 2019
To 30 Jan 2020
ARAC
ARAC

50
Annual report and accounts 2019-20
Report of the lead non-executive director
Archie Norman
Lead Non-Executive
and Deputy Chair of
Departmental Board
The last 12 months have seen a great deal of change. Most of this reporting
period has been largely dominated by preparing for EU Exit, with or without
a deal, and on moving into the transition period. The end of the reporting
period has, of course, been dominated by the COVID-19 pandemic and the
Government’s response to that. In both of these events, BEIS has played a
central role in preparing and planning for the UK’s economic future.
The Board has also seen a period of change, as it has been led by three
different Secretaries of State, with largely different Ministerial teams, and
there have also been significant changes in the Department’s senior team.
The membership of the Non-Executive Board Members has not changed
since last year and providing continuity and support to the Department.
The Department’s Non-Executive Board Members continue to be engaged
in Departmental business, providing challenge, valuable expertise and an
independent voice across a range of areas. The Board has come together
in both formal and informal settings to help drive the Departmental agenda
and, more recently, provide advice and support as the Department
responds to the COVID-19 pandemic. Throughout the reporting period,
the Department’s Audit and Risk Assurance Committee, led by Nigel
Boardman, has been very active and has continued to provide independent
challenge and scrutiny. It has helped to improve the way that the
Department approaches risk, as well as the assurance and compliance
environment, and has actively fostered links with the ARAC committees in
the Department’s Partner Organisations.
Looking at the year ahead, this year will continue to be challenging for BEIS
as the Department’s delivery agenda has grown substantially. I, and my
non-executive colleagues, will endeavour to continue to support and advise
the Department as the country moves towards the recovery phase of the
pandemic, to EU Exit and beyond. I wish to thank the dedicated and
excellent staff for their vital work and look forward to continuing to support
them as they work to deliver the government’s objectives, which are vital on
both the national and international stage.

51
Accountability report
Governance statement
Overview
The governance statement sets out how the
Department is governed and how decisions are
made at the top executive level, and summarises
the topics discussed by the Board, the Executive
Committee and their delegated committees.
It sets out the governance of the Department’s
partner organisations (POs) and considers the
risk management of the Department and its
internal controls.
Our board structure
Nominations
and governance
committee
Role: senior level
remuneration and
succession planning
Departmental
board
Role: directs strategy,
performance
management and risk
management
Audit and risk
assurance
committee
Role: assurance of
audit and risk control
functions.
Executive Committee
Role: manages the day-to-day running of BEIS – resource, policies
and programmes, including Brexit programme
Shadow
executive
committee
Role: staff
advisory body
People and
operations
committee
Role: manages human
resources, estates
and digital
Performance and
risk committee
Role: monitors
frameworks for
performance against
targets, budgets and
risks
Projects and
investment
committee
Role: approvals of key
investment proposals
and projects
Shadow people
and operations
committee
Role: staff advisory
body
Challenge function
for performance
and risk committee
Role: to support
P&R committee in its'
assessment of
Performance and
Risk report
Keyholder panel for
the projects and
investments
committee
Role: assurance of
investment proposals

52
Annual report and accounts 2019-20
Board and committee attendance
The table below shows board attendance from 1 April 2019 to 31 March 2020, where scheduled
meetings were held. Where members were unable to attend meetings in person, they were able to
share their views in advance with the chair.

Departmental
Board
Nominations
and
governance
committee
Audit
and risk
assurance
committee
Executive
committee
Total number of meetings held
4
1
6
25
x /x = number attended /number eligible to attend
Ministers
Rt Hon Greg Clark MP (to 24 Jul 2019)
1 /2
Rt Hon Andrea Leadsom MP (from 24 Jul 2019 to 13 Feb
2020)
2 /2
Rt Hon Alok Sharma MP (from 13 Feb 2020)
1 /1
Rt Hon Kwasi Kwarteng MP (from 24 Jul 2019)
1 /2
Rt Hon Chris Skidmore MP (until 24 Jul 2019; then from
10 Sep 2019 to 13 Feb 2020)
2 /2
Rt Hon Claire Perry MP (to 24 Jul 2019)
1 /2
Rt Hon Jo Johnson MP (from 24 Jul to 5 Sep 2019)
1 /1
Nadim Zahawi MP (from 26 Jul 2019)
2 /2
Kelly Tolhurst MP (to 13 Feb 2020)
1 /4
Lord Duncan (from 26 Jul 2019 to 13 Feb 2020)
1 /2
Lord Callanan (from 14 Feb 2020)
0 /1
Paul Scully MP (from 13 Feb 2020)
1 /1
Amanda Solloway MP (from 14 Feb 2020)
1 /1
Senior officials/executive directors
Alex Chisholm
4 /4
1 /1
1/6
23/25
Sam Beckett
1 /1
20 /25
Nick Chism (to 5 Feb 2020)
12/21
Julian Critchlow
1 /1
23/25
Sarah Harrison
3 /4
4/6
18/25
John Loughhead
17/25
Sarah Munby (from 15 Jul 2019)
1 /1
15/19
Jaee Samant
4 /4
21 /25
Jo Shanmugalingam (from 15 Jul 2019)
1 /1
13 /19
Joanna Whittington
1 /1
22/25
Gavin Lambert (interim DG from 30 Apr to 18 Jul 2019)
4 /7
Sam Lister (interim DG from 30 Apr to 18 Jul 2019)
5 /7
Tom Taylor
3 /4
6/6
20 /25
Caleb Deeks
1 /1
23 /25
Doug Watkins
20 /25
Craig Woodhouse (from 15 Jul 2019)
17 /19
Non-executive directors
Archie Norman
4 /4
Nigel Boardman
4 /4
6/6
Leena Nair
3 /4
0 /1
Stephen A. Carter
3 /4
Carolyn McCall
3 /4
Kathryn Parsons
4 /4
Stuart Quickenden
4 /4
6/6
Elaine Clements
6/6
Claire Davies (to 1 Jun 2019)
2/2
Louise Fisher
1 /1
Bryan Ingleby
6/6
Adrian Kamellard
6/6
Myriam Madden (to 30 Jan 2020)
4/6

53
Accountability report
Coverage of Departmental Board discussions
Discussion
Action
Progress
Strategy
Future economy
The board discussed support to UK
businesses and economy if World Trade
Organisation (WTO) rules were in effect.
BEIS revised its policy. developing
sector analysis under WTO rules
scenario
Brexit
The Board continued discussions on
departmental preparations for Brexit –
focused on communications plans, trade
and negotiation options facing the UK.
The Board commissioned business-
related sector analysis to discuss at
future board meetings.
Project Kingfisher
and Sectoral
and Regional
Competitiveness
Project Kingfisher refers to cross-
government preparations to respond to
potential economic impacts of Brexit.
The Board discussed BEIS’ approach to
using business intelligence to monitor,
anticipate and coordinate responses to
economic impacts on business.
The Board’s suggestions were
incorporated into policy development
New Work Agenda
Non-executive directors (NEDs) led the
discussion on the New work agenda
(NWA) from a business perspective,
challenged the thinking and assumptions
The Board identified apprenticeships
need to be part of NWA; joint working
with DfE continued.
UKRI
The Board discussed UKRI’s operating
context, related challenges and support
required to enable it to develop its
leadership capabilities and grow as an
organization.
BEIS offered advice and the next
phase of UKRI’s growth
Net Zero carbon
emissions
The Board discussed the challenges of
climate change and meeting net zero
targets; provided guidance on next
steps for reducing the Department’s
emissions.
Endorsed plans for cross Whitehall
policy cooperation, and CoP 26 Bid
Competition and
Consumers
The Board welcomed need for policy
reform, while challenging the early stage
policy assumptions, definitions and
purpose
The policy was revised to reflect the
board suggestions on purpose, clarity
and focus.
Governance
and risk
BEIS’ objectives and
priorities
The Board provided challenge on BEIS’
forward work programme for 2019;
continued setting priorities to strengthen
governance overall.
The work programme has been
amended based on the steer from
the Board.
Single Departmental
Plan
The Board’s discussion on BEIS
objectives and priorities supported the
development of the Single Departmental
Plan (SDP).
The lead non-executive board
member contributed to the
development of the SDP.
Risk appetite and
risk management
The Board endorsed the Risk Appetite
Statement; encouraged ARAC members
to observe board meetings; endorsed
the programme for ARAC NEDs to
attend POs ARAC meetings.
We embedded the risk appetite
statement throughout BEIS. The
online reporting tool was enhanced
to allow POs to record and report
against risks. This provides
assurance that risks are correctly
managed and recorded.
Operations
People Survey
The Board considered results from the
2019 People Survey; discussed plans to
raise engagement scores and develop
leadership initiatives.
The work-place transformation
programme has been reshaped as
result of board input.
The 21st Century
Workplace:
Progressive, Modern
and Innovative
The Board critically evaluated how to
set the foundations for transforming the
workplace, while building capability to
maximise the use of technology.
Shaping our Future objectives
were revised to reflect the Board’s
suggestions on ambition and
boldness.

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Annual report and accounts 2019-20
Board’s evaluation of its effectiveness
All departments are requested by the Cabinet
Office to carry out an annual board effectiveness
evaluation. The Board completed a light touch
assessment for 2019-2020, as a more in-depth
board evaluation assessment is expected in
2020-2021 in line with Cabinet Office guidance.
Overall, the Board’s evaluation of its effectiveness
indicated that the composition of the Board is
sound and effective. However, more work needs
to be done to ensure better communication and
visibility between the Board and delegated
Committees to improve governance.
In addition to formal board meetings, Board
members met for introductory meetings with the
newly appointed Secretaries of State in
September 2019 and March 2020. Non-
Executive Board members have also been active
in supporting the executive team throughout the
year by providing guidance and advice on a
range of issues.
Highlights of Nominations and governance
committee
The success of any organisation is based on
valuing its people. This involves having a good
strategy for personal and career development.
The Nominations and governance committee
(NGC) only met once in 2019-2020, but instead
considered issues by correspondence. During
2019-2020, NGC has focused on:
• senior level talent in BEIS; and
• the implementation of the staff performance
management systems.
Highlights of Audit and risk assurance
committee
Audit and risk assurance committee (ARAC)
plays a crucial role in supporting the effective
governance in BEIS. During 2019-20 ARAC has
worked to:
• improve the risk management procedures
through critical challenge and reviewing the
risk registers and risk framework;
• build a relationship with POs that is strong and
transparent:
• examine financial management and financial
reporting;
• oversee the process to ensure the appropriate
recognition of Hinkley Point C in the accounts;
• working with NAO & GIAA to test and monitor
the delivery of their audit plans;
• improve the internal assurance structure and
processes by providing guidance;
• monitor BEIS’ application of the Business
Appointment Rules – rules to prevent former
civil servants and ministers being able to profit
from their knowledge within Whitehall;
• introduce an exchange programme for ARAC
members and PO ARAC members;
• consider how legal risks should be better
identified, reported and managed throughout
the group- this work will be ongoing through
the next reporting year;
• ensure the Department’s implementation of
recommendations from NAO, GIAA and Public
Accounts Committee (PAC);
• support the launch of the Controls and
Assurance Tool (CAT) for teams to log and
self-assess the first and second lines of
defense;
• oversee the development and rollout of the
new departmental risk management
framework; and;
• start a rolling programme to seek governance
assurance from individual DGs at ARAC
meetings.
Highlights of Executive committee
Executive committee (ExCo) is the key body to
which the Departmental Board delegates the
day-to-day management of BEIS. Over the last
year, ExCo has focused on:
• the Industrial Strategy and Grand Challenges;
• monitoring the performance of the
Department’s major programmes;
• delivering Net Zero;
• business planning and the SDP;

55
Accountability report
• the delivery capacity and target operating
model of the department;
• the diversity and inclusion strategy; and
• the refresh of the departmental risk register,
including risk horizon scanning.
Brexit programme
In addition, the committee holds fortnightly
meetings on the Brexit programme to manage
identified Brexit related issues. Following Brexit,
the committee meetings now have an additional
focus on free trade agreements and progress on
EU engagement.
Highlights of ExCo subcommittees
People and operations committee
People and operations committee (POPCo)
considers matters relating to human resources,
accommodation, security and IT. In the last
12 months to March 2020, POPCo has
worked to:
• establish the BEIS graduate and experienced
entrant programme;
• monitor the success of the performance
management system;
• promote diversity and inclusion policy;
• review the health and safety policy;
• oversee the works of the estate and security
team; and
• oversee the works of the estate and security
team.
Performance and risk committee
Performance and risk committee (P&R) reviews
matters relating to performance and risks. In
2019, it underwent a thorough review which led
to a renewed mandate to:
• provide assurance on the performance and
delivery of major programmes including those
delivered by our POs;
• provide assurance on the departmental Risk
Framework;
• review departmental risk and risks associated
with delivery programme – especially
where this was operating outside the BEIS
Risk Appetite Statement;
• review performance against agreed milestones
and outcomes and provided assurance on the
use of the BEIS monitoring and evaluation
framework; and
• assess performance against the Department’s
internal control and assurance framework.
Projects and investments committee
The Project and investment committee (PIC)
reviews investment proposals over £20 million or
those considered risky, novel or contentious.
During 2019-20, PIC:
• initiated the fast-track process so no-deal
Brexit contingency investments could be
reviewed in a timely manner;
• maintained high standards and supported the
development of business cases; and
• ensured the approvals processes are well
aligned to promote a streamlined approach.
COVID-19 adjustments
At the very end of the reporting period, a specific
COVID-19 ExCo was set up to respond to the
Coronavirus pandemic. This had a larger
composition than the Departmental ExCo,
and met frequently during the first stage of the
pandemic to steer the Department’s response to
the pandemic and to consider the effects on our
staff. The governance relating to Coronavirus will
be reported fully in next year’s annual report and
accounts.
Additionally, all committee meetings have
been held remotely since the 18 March 2020.
These meetings have been successful and
productive, largely down to the flexibility of
committee members. All meetings have been
set up and supported by the Governance
Secretariat.

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Annual report and accounts 2019-20
Register of interests
Board Members are required to declare any
personal or business interests which may
influence their judgement, or be perceived to,
when performing their duties. BEIS has an
established procedure for considering, approving
and recording conflicts of interest. In addition to
this at the commencement of each Board
meeting, members of the Board are required to
declare any interests they may have. In 2019-20
there was only one conflict of interests registered
during the meeting and it was addressed
accordingly.
Biographies of our leadership team
Biographies of our Board members are available
at https://www.gov.uk/government/
organisations/department-for-business-energy-
and-industrial-strategy/about/our-governance
Board appointments
There have been changes in both Ministerial and
executive appointments to the board. The board
composition has reflected changes to the
Ministerial leadership of the Department in
2019-2020 as all members of the Ministerial
team have been appointed to the board.
There have also been changes to the executive
team on the board. Please refer to the table
on committee and board attendance for
further detail.
Compliance with the corporate governance
code
Our approach to governance is in line with ‘the
code’ – Corporate Governance in Central
Government Departments: Code of Good
Practice without exception.
Since BEIS is responsible for corporate
governance and champions women on boards,
BEIS seeks to be a leader in this area too. There
are two targets for Board membership: Lord
Davies’ target for 33% female Board
membership and Sir John Parker’s target of one
BAME Board member. By March 2020, BEIS
Board’s gender diversity was at 35% and
included four BAME members.
Quality of data used by the Board
Departmental Board meetings covered a variety
of topics. Board papers were of high quality.
The meetings were efficient, and challenge was
encouraged. BEIS’s governance team provides a
comprehensive secretariat service to the Board
and committees to ensure the effective and
efficient administration of the Board and its
activities.
Governance of our POs
In 2019-20, BEIS had 40 POs with a wide span
of policy and operational responsibilities.
We receive assurance on risks and delivery
through; the BEIS corporate reporting system;
day to day relationship through sponsors and
DG accountability for the organisations; PO
governance statements; and our ARAC
members engaging with individual PO ARACs.
Significant issues arising within POs are covered
in their respective governance statements.
BEIS has over-sight of its POs throughout the
year and considers any significant issues
presented in their governance statements.
Grants to local government
In 2019-20, the Department provided
£189.46 million as grants to local authorities
under section 31 of the Local Government act
2003. £151 million of this was in relation to
the COVID-19 response grants.
Quality assurance of analytical models
BEIS has had a single modelling quality
assurance (QA) process since April 2017,
which complies with the AQuA book.
Our modelling integrity team co-ordinates
independent assurance for models and plans.
This ensures our models are based on
appropriate understanding of evidence and risks.
We have identified 80 analytical models in use
across BEIS with 90% of these having the
required level of assurance. Those models that
are non-compliant have plans to reach
compliance targets in 2020-21. We ensure
our contacts in POs undertaking modelling
are aware of BEIS QA guidelines.

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Accountability report
Effectiveness of our risk management and
internal controls
The Government Internal Audit Agency (GIAA)
provides the internal audit service for BEIS. For
2019-20, the Group Chief Internal Auditor
provided a “moderate” opinion.
The GIAA concluded that BEIS has continued
with the positive trend in internal control, while
committing resources to Brexit preparations and
implementing complex policy programmes, such
as the Industrial Strategy and the Clean Growth
Strategy.
GIAA has acknowledged the implications that
BEIS’ response to the COVID-19 pandemic will
have in 2020, but this has not detracted from
their conclusions for 2019-20.
The audit of our risk management framework
and practice positioned BEIS as a top
performing department and a catalogue of good
practice is being drawn from across BEIS.
No audits received an unsatisfactory opinion,
and only two a limited opinion, for which actions
are in hand to address the recommendations
made by internal auditors.
Progress made on risk management
In 2019-2020, BEIS delivered several risk
management initiatives that have been
recognised across government and have been
replicated in other departments. We refreshed
our risk management framework and continued
to embed it, working with our network of deputy
director risk champions.
We developed and introduced a risk appetite
statement, working with the Audit and Risk
Assurance Committee and seeking views from
key colleagues across government. We fed into a
review of the Performance and Risk Committee,
resulting in a revised term of reference with a
sharper focus on risk. We continued to develop
our online risk management tool and ensured
directorate and group level risks were being
reported on regularly to enable better oversight
of the risk landscape of the Department and to
facilitate a more robust process for risk
escalation.
We opened our reporting tool to our POs, who
report quarterly to BEIS, to submit their reports.
We introduced league tables of compliance to
support this work and to assess the quality of
the content uploaded. Finally, we refreshed the
Departmental risk register through a horizon
scanning session with our Executive Committee,
to ensure these remained relevant given the
changing environment.
While a huge amount of work was done over the
year, it is recognised that most of the focus has
been on getting the right processes and tools in
place. There is more work to do to embed a risk
management culture across the Department and
to improve open and transparent risk
management between BEIS and its POs.
Internal controls environment
BEIS aims to continuously improve the efficiency
and effectiveness of the internal control
environment within the Department. During the
course of 2019-20 actions have been taken to
communicate expectations around compliance
to staff, improve our processes to make it easier
for staff to comply with controls, and provide
Management Information (MI) to help senior
managers understand how effectively they
are operating.
Work completed includes:
• continuing to ensure that audit actions are
implemented in a timely fashion with 78% of
internal audit actions due in 2019/20
completed;
• launching a line manager hub and surgery to
help line managers understand their key
responsibilities and improving access to
guidance and support;
• launching an improved Oracle interface to help
staff do things more easily and accurately
across Finance, HR and the Procurement
processes;
• providing new sources of MI to help SCS
understand the quality of our data and improve
compliance with HR processes; and

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Annual report and accounts 2019-20
• successfully piloted an online Controls and
Assurance Tool (CAT) during 2019-20, which
is providing a means of systematically
assessing how effectively the Department’s
controls are being implemented.
Although BEIS has made progress throughout
2019-20, the Department recognises there is still
further work to be done around culture of
compliance. Traditionally weak areas such as
recording starters and leavers remains an area
for continued focus, with the implications this
has for overpayments and return of IT equipment
and security passes. Process and compliance
improvement work within the Department will
aim to make further progress in these key areas,
which GIAA through their audit work in
FY2020‑21 will help to assess. While 78% of
actions due in 2019/20 have been completed,
there were 37 overdue actions. To address this,
we are improving our tracking and reporting of
actions, to make it easier to assess how the
Department is performing in addressing audit
recommendations.
Work will also continue to improve the
functionality of the new Oracle interface,
including by linking processes such as expenses
to enable a more accurate and timely
reimbursement of claims. The approach to MI
is being expanded, including prompt payment,
finances and expenses, which will help improve
our insight to how effectively controls are
operating. Following the initial rollout, the CAT
is also being developed further to better align
with the Department’s risk framework, make
better use of new sources of MI, and reflect
work to map the Departments controls and
assurance processes.’
Data protection
BEIS notified the Information Commission’s
Office (ICO) of one personal data breach
assessed as meeting the ICO’s reporting
guidelines. The ICO determined regulatory action
was not appropriate but made one
recommendation which BEIS has administered.
Information security
No significant cyber breaches were reported
in 2019-20. Malicious content on the web
continues to be a significant risk to the
Department. We have seen a growth in the
volume of generic Phishing emails as well as
increases in whaling (phishing targeted at
specific high value targets). We continue to
work to ensure all our services meet ISO27001
standards, recently completing a significant
cyber security assessment under the
GBEST scheme and adding a Security
Operations Centre.
Counter-fraud and error
During 2019-20, levels of fraud detected across
the BEIS group of organisations were similar to
previous years. We continue to be successful in
preventing fraud. We are also starting to recover
funds following successful prosecutions of frauds
committed in previous years. There was a
continued increase of attempted frauds against
the public imitating BEIS and its POs.
We achieved an overall ‘green’ rating from the
Cabinet Office in taking forward our action plan
and worked with them to implement
improvements. The level of staff in key roles who
have completed counter fraud training has
increased following successful awareness
campaigns, which were well received.
Towards the end of 2019-20, our focus was on
the enhanced risks of fraud and error associated
with the COVID-19 business support and loan
guarantee schemes. These will inevitably
dominate much of what we do in the next
reporting period.
Ministerial directions
Ministerial directions are formal, technical
instructions from the Secretary of State which
allow the Department to proceed with a
spending proposal in a situation where the
Accounting Officer has raised an objection.
The Accounting Officer is accountable to
parliament for ensuring that all expenditure
meets the standards under Managing Public
Money (MPM) and has a duty to seek a direction
if they believe one of the four criteria (regularity,

59
Accountability report
propriety, value for money or feasibility) will not
be met. If a direction is given, the Accounting
Officer will no longer be challenged by the Public
Accounts Committee on why they took forward
the policy. However, they might still need to
explain the course of the action and the
minister’s reasoning.
During the 2019-20 financial year, and up to the
date of this report, ten ministerial directions
were issued.
British Steel Limited
A Ministerial Direction was given for the
continuation of the Official Receiver’s (OR)
indemnity to pursue a sale of British Steel
Limited (BSL).
When BSL entered compulsory liquidation on
22 May 2019, the OR issued a deadline of
10 November 2019 for bidders to give the OR
suitable confidence that a sale could complete
shortly. Without this, the OR would commence a
shutdown process of the BSL site. By the
deadline date, significant progress had been
made with a potential buyer, but the Department
was yet to see a rigorous business plan.
HMG support to continue the sales process
would not satisfy the minimum value for money
consideration. However, the justification for site
sale were the wider benefits – the closure of the
site would result in job losses, impacting the local
economy and would also have a significant
strategic impact on the UK steel sector with key
sectors such as construction and rail being
disrupted.
The Ministerial Direction was given on
11 November 2019 authorising the continuation
of support to British Steel.
On 9 March 2020, the sale of BSL was
completed by the OR.
Coronavirus Business Interruption Loan Scheme
A second Ministerial direction was given,
authorising the Coronavirus Business Interruption
Loan Scheme (CBILS) to temporarily replace the
Enterprise Finance Guarantee (EFG) Scheme,
increasing the loan value available to £5 million
and to introduce a twelve-month interest free
period.
Given the speed at which the scheme was
developed, there was little robust data available
to conclude that they met the value for money
requirements of MPM. At the time of introducing
the scheme, there were also that were subject to
State Aid approval. Discussions with the
Commission had provided comfort that they
expected the Schemes to be approved, but
formal notification had not been received.
The Ministerial Direction was given on 22 March
2020 proceed with the introduction of the
scheme.
Support fund for retail, hospitality and leisure
businesses
A third Ministerial Direction was given authorising
a grant fund to help protect businesses in the
retail, hospitality and leisure sectors from the
impact of COVID-19.
Any assessment carried out by the Department
in relation to the fund would have been
comparing immeasurable and unknown benefits
against significant and known costs. It was not
possible for the Department to reliably
demonstrate the economic impact of the
proposal and provide the necessary assurance
that is represented value for money in line with
the requirements of MPM.
The Ministerial Direction was given on 23 March
2020 to proceed with the implementation of
the fund.
Small Businesses Grant Fund
A fourth Ministerial Direction was given
authorising a grant fund to help protect small
businesses from the impact of COVID-19.
The absence of available evidence meant that
the Department was unable to provide a reliable
value for money measurement by weighing the
possible benefits against costs. There were also
concerns around the feasibility of the scheme
due to the speed local authorities were expected
to make payments and the related operational
difficulties to administer the fund efficiently.
The Ministerial Direction was given on 23 March
2020 to proceed with the delivery of the scheme.

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Annual report and accounts 2019-20
Coronavirus Business Interruption Loan –
Changes to Scheme
A fifth Ministerial Direction was given authorising
changes to the Coronavirus Business
Interruption Loan Scheme (CBILS), including
removing the requirement for a personal
guarantee for loans under £250,000, and
removing the requirement for borrowers to show
that they would have been unable to secure
finance outside of a government backed loan.
The speed at which events unfolded did not
allow sufficient time for a full value for money
assessment to be undertaken and there
remained risks around the ability to deliver at
this volume. Uncertainties over likely demand
and future costs of the scheme, and provision of
budget cover were highlighted.
The Ministerial Direction was given on 2 April
2020 to proceed with the changes to the
scheme.
Coronavirus Large Business Interruption Loan
Scheme
A sixth Ministerial Direction was given authorising
the introduction a new scheme to support firms
that have a turnover of more than £45 million per
annum, to be known as the Coronavirus Large
Business Interruption Loan Scheme (CLBILS).
Due to the speed at which the intervention was
developed, it was difficult to assess ex-ante
whether value for money was likely to be
achieved meaning a wide range of outcomes
are possible.
The Ministerial Direction was given on 16 April
2020 to proceed with the introduction of the
scheme.
Local Authority Discretionary Grants
A seventh Ministerial Direction was given
authorising the introduction of the COVID-19
Local Authority Discretionary Grants Fund. This
fund provides local authorities with discretion to
administer a grant scheme to help support small
businesses in their localities who are not in scope
of either of the existing grant schemes.
As with the previous two COVID-19 business
grant schemes there were uncertainties around
the value for money of the scheme. And on the
basis of available information at the time, it was
not possible to construct a business case to
clearly demonstrate that the funding represented
value for money to the standards expected by
MPM.
The Ministerial Direction was given on 1 May
2020 to proceed with the introduction of the
scheme.
Bounce Back Loan Scheme
An eighth Ministerial Direction was given
authorising the introduction of the ‘Bounce Back’
Loan (BBL) Scheme which enables businesses
to access loans of up to £50,000, capped at
25% of turnover, with 100% of the lending risk
assumed by government.
The direction was required because of
uncertainty around the value for money case and
risk to regularity and propriety of the scheme
from fraud and error. Whilst steps were planned
to tackle fraud, the eventual level could not be
reliably estimated in advance.
The Ministerial Direction was given on 1 May
2020 to proceed with the introduction of the
scheme.
Future Fund
A ninth Ministerial Direction was given to
implement the Future Fund, which aims to
provide an incentive for equity funds and angel
investors to continue to support the development
trajectory of innovative, high-growth businesses.
It is designed to encourage investors to continue
to back companies that would have received
investment in the absence of the pandemic and
are now struggling to raise their next funding
round.
The view of Accounting Officer was that whilst
standards around feasibility, regularity and
propriety had been met, based on the limited
information and the range of analysis that had
been conducted, it was not possible to conclude
that the scheme represented value for money at
the time.

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Accountability report
The Ministerial Direction was given on 19 May
2020 to proceed with the introduction of the
Future Fund.
OneWeb
A tenth Ministerial Direction was given
authorising the purchase, via a consortium, of
OneWeb, a satellite technology company with
the ambition to provide global broadband. A UK
based company, representing an opportunity for
UK interests globally.
Professional financial advice on OneWeb’s
prospects was sought, which determined that a
positive return on the investment might be
achieved. However, it was also noted that a
broad range of uncertainties and possible
outcomes around the case remained, making it
hard to be confident in the underlying
assumptions or the likely returns.
Due to the time and data available, HM Treasury
had not subjected the investment to the scrutiny
of a full Green Book compliant business case,
including considering whether alternative options
for investment might provide a better return.
UK Space Agency were consulted for an
independent technical assessment and
highlighted a high likelihood of further investment
being required, increasing the risk that further
HMG investment would be required in order to
realise the potential benefits.
The view of the Accounting Officer was that
whilst risks around regularity, propriety and
feasibility were manageable, value for money
required a direction.
The Ministerial Direction was given on 26 June
2020 to proceed with the purchase of OneWeb.
Effectiveness of our whistle blowing
arrangements
Internal whistle blowing
Our procedures are accessible to all employees
and offer six different routes for employees to
raise concerns, including via an external
whistleblowing hotline. In 2019-20 we had a low
number of whistleblowing concerns raised,
which is consistent with previous years. In our
2019 People Survey we had an increased
majority of staff reporting that they had
confidence that any concerns raised under the
Civil Service Code would be properly
investigated.
External whistle blowing
A small number of whistle blowers reported
concerns during 2019-20. We have discussed
internally and with POs, ways in which we can
help staff come forward. We are looking to
extend our awareness campaign in this area and
offer workshops to cover the topic. Some of our
Agencies have also chosen to access our
external whistleblowing hotline. The volume of
calls to this line is low. Cases have predominantly
been referred to us through HR and the National
Audit Office.

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Annual report and accounts 2019-20
Accounting Officer’s conclusion
I have considered the evidence provided regarding the annual governance statement and the
independent assurance provided by ARAC. BEIS received a “moderate” opinion on the framework of
governance, risk management and control within the Department for 2019-20. Even though the
opinion remained the same as last year, the Department has continued to make improvements to our
governance, risk management and control environment throughout the past year.
Last year BEIS successfully delivered a significant amount of policy work and progressed its major
programmes such as the Industrial Strategy and the move to a Net Zero, whilst planning and
preparing for Brexit. At the same time the Department faces challenges in aligning the work and
priorities of other government bodies in order to achieve its objectives in 2020-2021.
During 2020-21, our top priority will be on delivering the COVID-19 response and steering the
economic recovery. We will also focus on:
• working on Brexit negotiations and delivering Net Zero;
• implementing a proportionate assurance regime over the third parties delivering the grant, loan and
guarantee schemes;
• embedding a culture of compliance and improving internal assurance mapping processes;
• enhancing the departmental Knowledge Management capability;
• BEIS’s litigation and cyber security risks and reporting on these; and
• further developing the POs governance framework, with strong links between BEIS and UKGI.
Sarah Munby
Permanent Secretary and
Principal Accounting Officer
11 September 2020

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Accountability report
Staff report
1
https://www.gov.uk/government/publications/disability-mental-health-and-wellbeing-support-in-our-workplace-beis-voluntary-
report-2019
Overview
The staff report highlights employee matters in
the year. It also provides required disclosures on
staff activity, staff numbers and expenditure in
2019-20.
Introduction
This year we have continued to make BEIS a
great place to work in what has been a
challenging and positive year for the Department.
We continue to make improvements in staff
engagement and launched our new Diversity &
Inclusion Strategy. We supported the
Department’s work on exiting the EU through a
largescale mobilisation of people across the
Department to meet new priorities. This helped
us learn how to be agile and responsive to new
challenges, which has proved vital now that we
are supporting the Department’s response to
COVID-19.
Employee matters
Health, safety, and well-being
We consider the wellbeing of our people very
important and we have an exceptionally good
well-being offer.
We offer events covering all areas of wellbeing,
such as training in resilience, stress
management, mental health talks, disability
awareness, and an annual sports day.
We have over 200 staff trained as Mental Health
First Aiders based throughout our offices.
The mental health first aider role gives first
support to those who seek help due to a mental
health concern.
We also offer the Employee Assistance
Programme – phone-based counselling, on work
and life issues, free, confidential, and available to
all employees.
In 2019, we published the BEIS Voluntary
reporting on disability, mental health, and
wellbeing1. This framework shows what we have
achieved in supporting staff and building
resilience for good mental health.
We have a strong record in providing a safe and
supportive work environment. In 2019-20, there
were three reported injuries within ‘reporting of
injuries, diseases and dangerous occurrences
Regulations 2013’. We encourage staff to ask for
reasonable adjustments as part of our
workstation assessment programme.
COVID-19 adjustments
The Department has played and continues to
play a vital role in the UK’s response to the
COVID-19 incident, supporting businesses,
workers and the economy. As a department we
moved from being predominantly office-based,
to working almost entirely remotely in a matter of
days, in accordance with public health advice.
The success of our organisation’s response has
been as much about people’s agility and flexibility
as the technology. We have placed a strong
emphasis on health, safety and wellbeing,
ensuring that people are well supported to work
from home. We work closely with Civil Service
HR on the short and long-term implications of
COVID-19.
Diversity and inclusion
We focus heavily on diversity and inclusion.
We are all different in some way. We each
experience the world differently and have stories
to tell about it. We make the most of these
differences to solve important and complex
policy issues facing the country, business and
the environment. In doing so, we continue to
make BEIS a great place to work.

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Annual report and accounts 2019-20
During the year we have:
• increased the diversity of our workforce;
• rolled out micro behaviours training to over
700 staff;
• undergone the Stonewall Workplace Equality
Index 2020. We were ranked 137 out of 503
employers, up from 270 out of 445 employers
last year; and
• in the 2019 people survey, maintained a score
of 83% for ‘inclusion and fair treatment’, up
from 80% in 2017.
Employee engagement
In the 2019 BEIS people survey; we achieved a
response rate of 92%. Overall, our results have
remained stable when compared with 2018.
The outcomes for eight of the nine survey
themes have either stayed the same or
improved.
This is a positive result given this had been a
year with additional pressure and change for all.
It is also within the context of the significant
progress we have made in the Engagement
Index and other key areas since 2016.
Our former Transformation programme, which
launched in 2017, delivered several critical
improvements, such as a new pay deal which
takes BEIS into the top 50% across Whitehall, a
new performance management system (PMS),
an overhaul of technology, launch of the BEIS
intranet and extensive business skills training.
Shared parental leave
During 2019-2020, 35 of our employees took
advantage of BEIS’ policy on shared parental
leave (SPL) and pay (ShPP).
It is a statutory entitlement to parents and
adopters. It gives parents the choice to shorten
the mother’s maternity leave and pay and share
the balance as SPL and ShPP. We continue to
promote this flexibility to our employees.
Gender pay gap
The trend in reducing the gender pay gap has
been positive for BEIS and its Agencies;
measures show the gaps are either reducing or
remaining relatively static.
Gender pay gap
The mean pay of male employees vs mean pay
of female employees had a difference of 10.1%.
The median gender pay gap was 10.2%. This
continues the trend in narrowing the gap, and
are the lowest figures since reporting was
introduced in 2017.
Bonus gap
The mean bonus pay to relevant male
employees vs mean bonus pay to relevant
female employees had a difference of 12.7%.
The median bonus gap was 17.9%. Although
figures have fluctuated in previous years, these
remain in line with previous years.
Bonus proportions
As in 2018, the proportion of men who received
a bonus was 83.4%; the proportion of women
who received a bonus was 83.7%.
Quartile pay bands
The proportions of male and female employees
in the bottom quartile was 60/40 split in favour of
women. The proportions of male and female
employees in the top quartile was 60/40 split in
favour of men. Figures are in line with 2017.
Closing the gender pay gap
To close the gender pay gap, one of our main
priorities is to increase representation of women
at senior levels. To do this, we aim to retain a
workforce that is diverse, talented, and
supported to achieve its potential.
On recruitment, we have introduced initiatives to
produce job adverts that are more inclusive and
to ensure interview panels are more diverse. We
also overhauled our approach to performance
management in 2018-19. We moved us away
from lengthy processes, to conversations with a
real focus on development. This will allow us
monitor diversity of outcomes on performance
more easily.
The full Gender Pay Gap report for 2019 can be
found at https://www.gov.uk/government/
publications/beis-gender-pay-gap-report-and-
data-2019

65
Accountability report
Executive pay gap
This is disclosed under ‘fair pay’ as part of the
remuneration report on page 87.
Staff policies applied for
disabled staff
We are committed to ensuring equality for all our
people, including those with disabilities.
We make clear in our job application process –
candidates with a disability who apply for a post
under the guaranteed interview scheme,
automatically go forward to the interview stage,
provided they meet the minimum criteria.
We also promote external vacancies in a range
of diversity media. Where staff are identified as
needing reasonable adjustments, these will be
provided.
We have an active staff network – Capability
Action Network (CAN) – which champion the
needs of people with disabilities and long-term
health conditions. They work with HR and other
areas of the Department to create positive
change. As a result of feedback from CAN new
line managers will now undertake an e-learning
course on ‘disability inclusive management’ as
part of their induction.
Sickness absence data
Average working days lost to sickness absence
in 2019-20 for the Core Department, UKSA and
INSS were 3.5, 9.3 and 6.6, respectively.

66
Annual report and accounts 2019-20
Staff composition
Figures represent full-time equivalent (FTE) persons on payroll as at 31 March 2020.
Gender
Men
Women
Total
All employees
2,269
2,040
4,309
All employees %
53%
47%
100%
All senior civil servants
133
109
242
Executive committee
10
6
16
Disability
Declaration rate: 75%. Representation for staff who have declared:
84%
No
Yes
Prefer not to say
10%
6%
Ethnicity
Declaration rate: 79%. Representation for staff who have declared:
78%
White
BAME
Prefer not to say
18%
4%
Sexual orientation
Declaration rate: 80%. Representation for staff who have declared:
84%
Straight
LGBT+
Prefer not to say
8%
8%

67
Accountability report
Trade union facility time
Core
Department and
Agencies
Other
agencies not
consolidated in
the accounts1
Total
Union officials
Number of employees who were relevant union officials
42
44
86
Full-time equivalent persons
38.80
41.85
80.65
Number of employees by working hours spent on
facility time
0% of working hours
4
6
10
1 - 50% of working hours
38
38
76
Facility time as a % of pay bill
Total cost of facility time (£)
101,858
108,116
209,974
Total pay bill (£)
365,640,202
208,105,626
573,745,828
Facility time as a % of pay bill
0.03%
0.05%
0.08%
Paid trade union activities
(Hours spent on paid trade union activities ÷ total paid facility
time hours) * 100
0.00%
7.37%
7.37%
Notes
1 agencies not consolidated in Departmental Group accounts: CH, IPO, Met Office

68
Annual report and accounts 2019-20
Number of senior civil servants by salary band
The table below shows the number of full-time
equivalent (FTE) senior civil servants (SCS) by
salary bands, in the Core Department. It includes
those on open-ended contracts and fixed term
contracts. Salary ranges represent actual salary
rates; bonuses are not included.
The remuneration of civil servants is based on
performance ratings. The performance ratings
are determined by the permanent secretary and
directors general in post during the year. Names
of those in post are listed in the box below.
Salary range
Number of
SCS staff as
at 31 March
2020
Number of
SCS staff as
at 31 March
2019
£60,000 - £64,999
–
3
£65,000 - £69,999
35
74
£70,000 - £74,999
84
54
£75,000 - £79,999
31
21
£80,000 - £84,999
20
13
£85,000 - £89,999
4
9
£90,000 - £94,999
28
26
£95,000 - £99,999
9
6
£100,000 - £104,999
6
5
£105,000 - £109,999
2
2
£110,000 - £114,999
3
3
£115,000 - £119,999
2
2
£120,000 - £124,999
1
5
£125,000 - £129,999
7
5
£130,000 - £134,999
1
3
£135,000 - £139,999
–
1
£140,000 - £144,999
2
3
£145,000 - £149,999
2
1
£155,000 - £159,999
1
1
£160,000 - £164,999
1
2
£170,000 - £174,999
1
1
£180,000 - £184,999
2
2
Total
242
242
Permanent secretary and directors general
between 1 April 2019 to 31 March 2020
Alex Chisholm
Permanent Secretary
Sam Beckett
Director General
Nick Chism
Chief Business Adviser (to 5 February 2020)
Julian Critchlow
Director General
Sarah Harrison
Director General
John Loughhead
Chief Scientific Adviser
Sarah Munby
Director General (from 15 July 2019)
Jaee Samant
Director General
Jo Shanmugalingam
Director General
Joanna Whittington
Director General
Gavin Lambert
Director General (interim)
(from 15 April 2019 to 12 July 2019)
Sam Lister
Director General (interim)
(from 15 April 2019 to 12 July 2019)
Gareth Davies
Director General (to 3 May 2019)

69
Accountability report
Analysis of staff numbers and costs
Audited information
Staff numbers
The average number of full time equivalent persons employed in 2019-20 is shown in the table below.
Number of staff by category
Permanent
employed
staff
Others
Ministers
Special
advisers
2019-20

Total
2018-19

Total
Core
4,345
182
6
3
4,536
4,062
Agency
1,854
57
–
–
1,911
1,743
Non departmental public bodies
(NDPBs)
13,370
1,031
–
–
14,401
14,562
Total
19,569
1,270
6
3
20,848
20,367
Of which:
Core Department and
Agencies
6,199
239
6
3
6,447
5,805
NDPBs and other designated
bodies
13,370
1,031
–
–
14,401
14,562
Total
19,569
1,270
6
3
20,848
20,367
Staff costs
During the year, £19,608,726 of staff costs were
capitalised, (2018-19: £18,519,467) and 354
employees (2018-19: 386 employees) in the
Departmental Group were engaged on capital
projects during the reporting period.
Staff severance costs for current and prior year
are included in wages and salaries. Further detail
on exit packages is included on page 71.
Included within the total net costs of other staff
shown below are ministers’ total net costs of
£369,658 (2018-19: £329,921) and special
advisors’ total net costs of £157,963 (2018-19:
£272,475). Responsibility for remuneration of
special advisers transferred to the Cabinet Office
during 2019-20.
Permanent
employed
staff
£m
Others
£m
2019-20

Total
£m
2018-19

Total
£m
Wages and salaries
855
73
928
855
Social security costs
95
–
95
86
Other pension costs
217
–
217
179
Sub total
1,167
73
1,240
1,120
Less recoveries in respect of outward secondments
–
–
–
(1)
Total net costs
1,167
73
1,240
1,119
Of which:
Core Department and Agencies
372
18
390
330
NDPBs and other designated bodies
795
55
850
789
Total net costs
1,167
73
1,240
1,119

70
Annual report and accounts 2019-20
Pension schemes
Principal Civil Service Pension Scheme
Nuclear site licence companies are not included
in these pension schemes. The Principal Civil
Service Pension Scheme (PCSPS) and the Civil
Servant and Other Pension Scheme (CSOPS),
known as “Alpha”, are an unfunded multi-
employer defined benefit scheme in which the
Department is unable to identify its share of the
underlying assets and liabilities. The scheme
actuary valued the PCSPS as at 31 March 2016.
Further details can be found in the resource
accounts of the Cabinet Office Civil
Superannuation
(www.civilservicepensionscheme.org.uk/about-
us/resource-accounts/).
For 2019-20, employer contributions of
£100,753,599 were payable to the PCSPS
(2018-19: £65,627,469) at one of four rates in
the range 26.6% to 30.3% (2018-19: 20.0% to
24.5%) of pensionable pay, based on salary
bands.
The scheme’s actuary reviews employer
contributions usually every four years following a
full scheme valuation. The contribution rates are
set to meet the cost of the benefits accruing
during 2019-20 to be paid when the member
retires and not the benefits paid during this
period to existing pensioners.
Employees can opt to open a partnership
pension account, a stakeholder pension with an
employer contribution. Employers’ contributions
of £ 1,221,237 (2018-19: £1,192,970) were paid
to one or more of the panel of three appointed
stakeholder pension providers. Employer
contributions are age-related and range from 8%
to 14.75%. Employers also match employee
contributions up to 3% of pensionable earnings.
In addition, employer contributions of £17,180
(2018-19: £12,811), 0.5% (2018-19: 0.5%) were
payable to the PCSPS to cover the cost of the
future provision of lump sum benefits on death in
service and ill health retirement of these
employees.
Contributions due to the partnership pension
providers at 31 March 2020 were £11,448
(2018-19: £38,599). Contributions prepaid at
that date were £nil (2018-19: £nil).
In 2019-20, 43 persons (2018-19: 18 persons)
across the Departmental Group retired early on
ill‑health grounds; the total additional accrued
pension liabilities in the year amounted to
£2,319,227 (2018-19: £1,134,823).
Other pension schemes
Employer contributions to other pension
schemes in 31 March 2020, amounted to
£232,281,655 (2018-19: £261,129,179).
Employer contributions include employers’
contributions, current service costs and where
appropriate past service costs of funded pension
schemes. Further details can be found in the
accounts of the Department’s NDPBs and other
designated bodies. A list of these bodies is
provided in note 27.
Nuclear site licence companies: staff
numbers and costs
Staff costs for nuclear site licence companies
(SLCs) are disclosed separately, as they are
included in the amounts shown for utilisation in
the NDA’s nuclear decommissioning provision in
note 18 rather than being reported as staff costs
in the Statement of Comprehensive Net
Expenditure.
Permanently
employed
staff
Others
2019-20

Total
2018-19

Total
Number of staff (full time equivalent)
14,324
1,104
15,428
15,869
Wages and salaries (£m)
797
67
864
826
Social security costs (£m)
90
–
90
88
Other pension costs (£m)
144
–
144
148
Total costs (£m)
1,031
67
1,098
1,062

71
Accountability report
Exit packages
Audited information
Redundancy and other departure costs have
been paid in accordance with the provisions of
the Civil Service Compensation Scheme, a
statutory scheme made under the
Superannuation Act 1972. The table below
shows the total cost of exit packages agreed
and accounted for in 2019-20 (2018-19
comparative figures are also given). £19,975,567
exit costs were paid in 2019-20, the year of
departure (2018-19: £3,133,979). Where the
Department has agreed early retirements, the
additional costs are met by the Department
and not by the Civil Service pension scheme.
Ill‑health retirement costs are met by the Pension
Scheme and are not included in the table.
Number of compulsory
redundancies
Number of other
departures agreed
Total number of exit
packages by cost band
Exit package cost band
2019-20
2018-19
2019-20
2018-19
2019-20
2018-19
Less than £10,000
2
7
11
23
13
30
£10,000 - £25,000
2
33
25
25
27
58
£25,000 - £50,000
19
13
32
25
51
38
£50,000 - £100,000
16
–
70
13
86
13
£100,000 - £150,000
1
1
25
4
26
5
£150,000 - £200,000
–
–
17
–
17
–
More than £200,000
1
–
35
–
36
–
Total number of exit packages
41
54
215
90
256
144
Of which:
Core Department and Agencies
–
–
1
8
1
8
NDPBs and other designated bodies
41
54
214
82
255
136
Total number of exit packages
41
54
215
90
256
144
Total cost (£)
2,175,747
1,092,442
22,377,319
2,947,889
24,553,066
4,040,331
Of which:
Core Department and Agencies
–
–
95,000
677,852
95,000
677,852
NDPBs and other designated bodies
2,175,747
1,092,442
22,282,319
2,270,037
24,458,066
3,362,479
Total
2,175,747
1,092,442
22,377,319
2,947,889
24,553,066
4,040,331

72
Annual report and accounts 2019-20
Staff on loan
As at 31 March 2020, 1 member of staff
permanently employed by the Core Department
was attached on loan to another organisation on
a short-term basis (loan duration up to six
months) and 114 staff on a long-term basis (loan
duration longer than six months). 2 people were
attached to the Core Department on loan from
other organisations on a short-term basis and 60
on a long-term basis. Costs relating to staff on
short-term loans were charged to Administration
budgets in cases where the Core Department
paid the cost or would have been charged to
Administration budgets had the Core
Department paid the cost.
Grade
Outward staff loans
Inward staff loans
Less than 6
months
More than 6
months
Less than 6
months
More than 6
months
Administrative assistant
–
–
–
–
Executive officer
–
6
–
–
Higher executive officer
–
32
–
4
Senior executive officer
–
18
–
6
Grade 7
–
39
1
31
Grade 6
–
11
1
12
Senior civil service
1
8
–
7
Total
1
114
2
60
EU Exit
An average of approximately 1,130 full-time
equivalent staff were engaged on activities
relating to EU Exit during 2019-20 (2018-19:
1,030).
Consultancy and Temporary staff expenditure
The Departmental Group’s expenditure on
consultancy in 2019-20 was £55.6 million
(2018-19: £61.9 million). The consultancy
expenditure of executive agencies was £2.5
million (2018-19: nil) and the consultancy
expenditure relating to arm’s length bodies was
£41.7 million (2018-19: £51.9 million) of which
£27.7 million (2018-19: £30.8 million) was related
to Site Licence Companies. Consultants are
hired to work on projects in a number of specific
situations: where the Department does not have
the skills set required; where the particular
requirement falls outside the core business of
civil servants; or where an external, independent
perspective is required. When used appropriately,
consultancy can be a cost effective and efficient
way of getting the temporary and skilled external
input that the Department needs. The
Departmental Group’s expenditure on temporary
staff in 2019-20 was £73 million (2018-19: £70
million), as detailed in the Staff costs note above.
The increase year-on-year relates mainly to
temporary staff recruited to support work
associated with EU Exit preparations. We are
committed to the consistent application of the
Cabinet Office’s 2010 controls on consultancy
and other spending.

73
Accountability report
Off-payroll engagements
The tables below present data on our off-payroll
engagements. Off-payroll engagements refer to
workers who are paid off-payroll, without
deducting tax and national insurance at source,
typically contractors.
Table 1a: Off-payroll engagements as of 31 March 2020, for more than £245 per day and
that last longer than 6 months
At time of reporting, number that have existed for:
Total
number
Less
than 1
year
1 to 2
years
2 to 3
years
3 to 4
years
4 years
or more
Core Department and Agencies
Core Department
26
12
11
2
1
0
Insolvency Service
4
1
3
0
0
0
UK Space Agency
9
6
3
0
0
0
Consolidated in the Departmental Group accounts,
(excluding nuclear site licence companies)
Advisory, Conciliation and Arbitration Service
1
0
0
1
0
0
Civil Nuclear Police Authority
8
4
1
3
0
0
Coal Authority
1
1
0
0
0
0
Competition Appeal Tribunal and Competition Service
2
0
1
0
0
1
Diamond Light Source Ltd
6
3
0
1
0
2
The Financial Reporting Council Ltd
0
0
0
0
0
0
Low Carbon Contracts Company Ltd
1
1
0
0
0
0
Nuclear Decommissioning Authority
36
15
13
4
3
1
Nuclear Decommissioning Authority Archives Ltd
1
0
1
0
0
0
Radioactive Waste Management Ltd
20
12
4
0
0
4
Oil and Gas Authority
2
0
1
1
0
0
South Tees Site Company Ltd
0
0
0
0
0
0
UK Atomic Energy Authority
110
29
37
15
7
22
UK Research and Innovation
31
14
10
3
0
4
Innovate UK Loans Ltd
0
0
0
0
0
0
STFC Innovations Ltd
0
0
0
0
0
0
UK Shared Business Services Ltd
13
0
8
4
1
0
Not consolidated in the Departmental Group
accounts
Groceries Code Adjudicator
1
0
1
0
0
0
Pubs Code Adjudicator
2
0
0
1
1
0
Small Business Commissioner
2
2
0
0
0
0
Total
276
100
94
35
13
34

74
Annual report and accounts 2019-20
Table 2a: New off-payroll engagements, or those that reached 6 months in duration,
between 1 April 2019 and 31 March 2020, for more than £245 per day and that last longer
than 6 months
Total number
Number assessed as in
scope of IR35 assessment
Number assessed as
outside scope of IR35
assessment
Number engaged directly
(via PSC contracted to the
Department) and are on
the Departmental payroll
Number reassessed for
consistency/ assurance
purposes during the year
Number that saw change
to IR35 status following
the consistency review
Core Department and Agencies
Core Department
19
5
14
0
0
0
Insolvency Service
20
16
4
0
20
0
UK Space Agency
23
9
14
0
0
0
Consolidated in the Departmental Group
accounts, (excluding nuclear site licence
companies)
Advisory, Conciliation and Arbitration Service
2
0
2
0
0
0
Central Arbitration Committee
0
0
0
0
0
0
Civil Nuclear Police Authority
8
0
8
0
8
0
Coal Authority
1
0
1
0
0
0
Committee on Climate Change
0
0
0
0
0
0
Competition Appeal Tribunal and Competition
Service
0
0
0
0
0
0
Diamond Light Source Ltd
6
0
6
0
6
0
The Financial Reporting Council Ltd
0
0
0
0
0
0
Low Carbon Contracts Company Ltd
3
2
1
0
1
0
Nuclear Decommissioning Authority
15
4
11
0
0
0
Nuclear Decommissioning Authority Archives Ltd
1
1
0
0
0
0
Radioactive Waste Management Ltd
15
15
0
0
0
0
Oil and Gas Authority
3
0
3
0
0
0
South Tees Site Company Ltd
0
0
0
0
0
0
UK Atomic Energy Authority
56
56
0
0
0
0
AEA Insurance Ltd
0
0
0
0
0
0
UK Research and Innovation
33
13
20
0
0
0
Innovate UK Loans Ltd
0
0
0
0
0
0
STFC Innovations Ltd
0
0
0
0
0
0
UK Shared Business Services Ltd
13
0
13
0
11
0
Not consolidated in the Departmental
Group accounts
Pubs Code Adjudicator
0
0
0
0
0
0
Small Business Commissioner
2
2
0
0
0
0
Total
220
123
97
0
46
0

75
Accountability report
Table 3a: Off-payroll engagements of board members, and/or, senior officials with
significant financial responsibility, between 1 April 2019 and 31 March 2020
Number of off-payroll
engagements of board
members, and/or senior
officials with significant
financial responsibility
Total number of individuals
on payroll and off-payroll that
have been deemed ‘board
members and/or senior
officials with significant
financial responsibility’ during
the financial year
Core Department and Agencies
Core Department
0
31
Insolvency Service
0
11
UK Space Agency
0
9
Consolidated in the Departmental Group accounts,
(excluding nuclear site licence companies)
Advisory, Conciliation and Arbitration Service
0
6
Central Arbitration Committee
0
0
Certification Office for Trade Union and Employers’
Associations
0
0
British Business Bank plc
0
10
British Business Aspire Holdco Ltd
0
2
British Business Finance Ltd
0
10
British Business Financial Services Ltd
0
4
British Business Investments Ltd
0
4
British Patient Capital Limited
0
3
BBB Patient Capital Holdings Ltd
0
3
Capital for Enterprise Fund Managers Ltd
0
3
Capital for Enterprise (GP) Ltd
0
2
Capital for Enterprise Limited
0
2
The Start-Up Loans Company
0
2
Civil Nuclear Police Authority
0
7
Coal Authority
0
11
Committee on Climate Change
0
14
Competition Appeal Tribunal and Competition Service
2
6
Diamond Light Source Ltd
0
6
The Financial Reporting Council Ltd
0
2
Low Carbon Contracts Company Ltd
0
8
Nuclear Decommissioning Authority
0
17
Nuclear Decommissioning Authority Archives Ltd
0
0
Radioactive Waste Management Ltd
1
8
Oil and Gas Authority
0
1
South Tees Site Company Ltd
0
2
UK Atomic Energy Authority
2
14
AEA Insurance Ltd
2
2
UK Research and Innovation
1
26
Innovate UK Loans Ltd
0
0
STFC Innovations Ltd
0
0
UK Shared Business Services Ltd
0
2

76
Annual report and accounts 2019-20
Number of off-payroll
engagements of board
members, and/or senior
officials with significant
financial responsibility
Total number of individuals
on payroll and off-payroll that
have been deemed ‘board
members and/or senior
officials with significant
financial responsibility’ during
the financial year
Not consolidated in the Departmental Group
accounts
British Hallmarking Council
0
1
Groceries Code Adjudicator
0
1
Pubs Code Adjudicator
1
3
Small Business Commissioner
2
4
Total
11
237
Notes to table 3a: details of the exceptional circumstances that led to the engagements and
duration of engagements
Competition Appeal Tribunal and Competition
Service
One off-payroll member was appointed as a
training provider, as the President of the Tribunal
has a statutory duty to provide training to
members of the Tribunal. They have been a
member of the Tribunal since its inception in
2000 and have knowledge of its processes and
case histories. They are a fellow of the Higher
Education Academy among other qualifications.
The President and the Registrar of the Tribunal
view it as very important that the training provider
continues to develop and deliver training, as well
as support other engagements.
Duration: appointed in 2013, and the contract
was renewed in 2015 and 2017.
The other off payroll member also had been a
member of the Tribunal sitting on cases with new
legislation was appointed to the training
committee. The second member assists the first
member to prepare training materials, and they
also provide the training along with the first
member. They are gaining understanding of the
training activities to provide training in the
absence of the first member.
Duration: appointed in January 2019.
Radioactive Waste Management
The off-payroll person is a Swedish national with
unique experience in successfully leading the
delivery of the GDF programme in Sweden.
Duration: contract ended 31 March 2020, and in
process of being renewed on-payroll
UKAEA
The two off-payroll appointments were of non-
Exec Board members who reached the end of
their appointment during the year, but were
retained on a short term basis pending the
appointment of new non-Exec Board members.
AEAIL
AEAIL does not employ anyone. AEAIL is a
captive insurance company registered in the Isle
of Man and subject to their tax and NI legislation.
The two AEAIL directors are off-payroll by default
and are paid a small fee by AEAIL.
Duration: From 2002 and 2005 respectively.

77
Accountability report
UKRI
The off-payroll person is the Chief Financial
Officer. The appointment was due to the
importance of the post and the need to fill swiftly
on an interim basis.
Duration: From 14 July 2019, and their
appointment ran until 30 June 2020. From 1 July
2020 their appointment was extended as Chief
Operating Officer.
Pubs Code Adjudicator
The off-payroll person was extensively involved in
developing the Pubs Code and has sound
knowledge of a highly complex area of policy.
Duration: From April 2017.
The Small Business Commissioner
The two, off-payroll persons are non-executive
directors for the Advisory Board and Audit, Risk
& Assurance Board. These members have T&C
to work with the SBC for 4 years.
Duration: From 7January 2019.

78
Annual report and accounts 2019-20
SLCs: off-payroll engagements
SLCs deliver work for NDA, and fall within the
Departmental accounting boundary; however,
they operate with a high degree of autonomy.
Although SLCs have a higher number of off-
payroll workers, they represent a small proportion
of the overall workforce. Due to the specialised
and project driven nature of their work, there is a
need to bring in unique skills and experience
which cannot be found in house.
Table 1b: Off-payroll engagements as of 31 March 2020, for more than £245 per day and
that last longer than 6 months
At time of reporting, number that have existed for:
Total
number
Less
than 1
year
1 to 2
years
2 to 3
years
3 to 4
years
4 years
or more
Dounreay Site Restoration Ltd
29
2
7
2
1
17
LLW Repository Ltd
32
16
10
2
2
2
Magnox Ltd
111
5
18
33
16
39
Sellafield Ltd
197
38
38
27
12
82
Total
369
61
73
64
31
140
Table 2b: New off-payroll engagements or those that reached 6 months in duration,
between 1 April 2019 and 31 March 2020, for more than £245 per day and that last longer
than 6 months
Total number
Number assessed as in scope of
IR35 assessment
Number assessed as outside
scope of IR35 assessment
Number engaged directly (via PSC
contracted to the Department)
and are on the Departmental
payroll
Number reassessed for
consistency/ assurance purposes
during the year
Number that saw change to IR35
status following the consistency
review
Dounreay Site Restoration Ltd
5
5
0
0
0
0
LLW Repository Ltd
7
0
7
0
0
0
Magnox Ltd
8
2
6
0
8
0
Sellafield Ltd
46
19
27
0
19
12
Total
66
26
40
0
27
12

79
Accountability report
Table 3b: Off-payroll engagements of board members, and/or, senior officials with
significant financial responsibility, between 1 April 2019 and 31 March 2020
Number of off-payroll
engagements of board
members, and /or senior
officials with significant
financial responsibility
Total number of individuals
on payroll and off-payroll that
have been deemed ‘board
members and /or senior
officials with significant
financial responsibility’ during
the financial year
Dounreay Site Restoration Ltd
8
11
LLW Repository Ltd
1
9
Magnox Ltd
0
9
Sellafield Ltd
0
1
Total
9
30
Notes to table 3b: details of the exceptional circumstances that led to the engagements,
and duration of engagements
Dounreay Site Restoration Ltd
All 8 persons have been seconded from the
PBO, and Dounreay incur their costs.
Duration of engagements is as follows:
i) from 07 Jan 2020, ii) from 20 Nov 2019,
iii) from 25 Nov 2019, iv) from 23 Sep 2019,
v) from 16 Nov 2018, vi) from 01 June 2018,
vii) from 16 May 2017, viii) from 02 Sep 2015.
LLW Repository Ltd
The 1 off-payroll post holder was supplied by
the parent body organisation as required by
contractual arrangements with NDA.
Duration: From 1 Dec 2015.

80
Annual report and accounts 2019-20
Remuneration report
Remuneration policy
Ministers
Remuneration of ministers is determined in
accordance with the provisions of the Ministerial
and other Salaries Act 1975 (as amended by
The Ministerial and other Salaries Order 1996)
and the Ministerial and other Pensions and
Salaries Act 1991.
Senior civil servants
The Senior Salaries Review Body provides
independent advice to the Prime Minister on the
remuneration of senior civil servants. The review
body considers economic considerations such as
local variations in labour markets and funds
available to departments. Further information
about the work of the review body can be found
at https://www.gov.uk/government/organisations/
review-body-on-senior-salaries.
Service contracts
The Constitutional Reform and Governance Act
2010 requires Civil Service appointments to be
made on merit on the basis of fair and open
competition. The Recruitment Principles
published by the Civil Service Commission
specify the circumstances when appointments
may be made otherwise. Unless otherwise stated
below, the officials covered by this report hold
appointments which are open-ended. Early
termination, other than for misconduct, would
result in the individual receiving compensation
as set out in the Civil Service Compensation
Scheme. Further information about the work of
the Civil Service Commission can be found at
https://civilservicecommission.independent.gov.uk.
Ministers’ remuneration
Salary and pension entitlements of ministers of
the Department for the year ending 31 March
2020 are set out in the tables below.
Ministers – single total figure of
remuneration
Audited information
Where ministers have moved to or from another
department during the year, details of any
remuneration relating to their subsequent or prior
roles will be in that department’s remuneration
report. Ministers who transfer from another
department continue being paid at the
appropriate rate of pay with effect from the
first day of the month following the date of
appointment. Former ministers who transfer to
other departments are paid at their current rate of
pay up to the end of the month. Any increase in
ministers’ salaries on transfer from the date of
appointment is paid by their new department.

81
Accountability report
2019-20
2018-19
Salary1
£
Full year
equivalent
salary if
different
£
Pension
benefits2
to
nearest
£1,000
Total to
nearest
£1,000
Salary1
£
Full
year
equivalent
salary if
different
£
Pension
benefits2
to
nearest
£1,000
Total to
nearest
£1,000
Secretary of State
Rt Hon Alok Sharma
MP (from 13 February
2020)3
8,729
67,505
3,000
12,000
–
–
–
–
Rt Hon Andrea
Leadsom MP (from
24 July 2019 to 13
February 2020)4
54,421
67,505
8,000
62,000
–
–
–
–
Rt Hon Greg Clark MP
(to 24 July 2019)5
38,107
67,505
6,000
44,000
67,505
–
17,000
84,000
Ministers of State
Rt Hon Kwasi
Kwarteng MP (from
24 July 2019)6
21,320
31,680
5,000
27,000
–
–
–
–
Lord Grimstone (from
18 March 2020)7
–
–
–
–
–
–
–
–
Rt Hon Chris Skidmore
MP (from 5 December
2018 to 25 July
2019 and from 10
September 2019 to
13 February 2020)8
30,223
31,680
3,000
33,000
10,219
31,680
3,000
13,000
Rt Hon Jo Johnson
MP (from 24 July 2019
to 5 September 2019)9
11,511
31,680
1,000
12,000
–
–
–
–
Rt Hon Claire Perry MP
(to 24 July 2019)10
17,884
31,680
3,000
21,000
31,680
–
7,000
39,000
Parliamentary
Under-Secretaries
of State
Nadhim Zahawi MP
(from 26 July 2019)11
–
–
–
–
–
–
–
–
Lord Callanan (from
13 February 2020)12
13,880
107,335
4,000
18,000
–
–
–
–
Paul Scully MP (from
13 February 2020)
2,893
22,375
1,000
4,000
–
–
–
–
Amanda Solloway
MP (from 13 February
2020)
2,893
22,375
1,000
4,000
–
–
–
–
Lord Duncan (from
26 July 2019 to
13 February 2020)13
75,419
107,335
8,000
84,000
–
–
–
–
Kelly Tolhurst MP (from
19 July 2018 to 13
February 2020)14
20,510
22,375
5,000
25,000
15,072
22,375
4,000
19,000
Rt Hon Lord Henley (to
26 July 2019)15
34,336
107,335
–
34,000
105,076
–
17,000
122,000
Rt Hon Jake Berry MP
(from 7 June 2019 to
24 July 2019)16
–
–
–
–
–
–
–
–
Andrew Stephenson
MP (from 4 April 2019
to 25 July 2019)17
7,272
22,375
2,000
9,000
–
–
–
–

82
Annual report and accounts 2019-20
Notes
1
Salary information excludes employers’ national insurance contributions. None of the ministers of the Department received benefits
in kind during the year. Ministers in the House of Commons are remunerated on a different basis to those in the House of Lords as
explained in Notes to the Remuneration report.
2
The value of pension benefits accrued during the year is calculated as (real increase in pension multiplied by 20) less (contributions
made by the individual). Real increase excludes increases due to inflation or any increase or decrease due to transfer of pension rights.
3
Previously Secretary of State for International Development.
4
Salary includes £16,876 statutory payment on cessation of Ministerial office.
5
Salary for 2019-20 includes £16,876 statutory payment on cessation of Ministerial office.
6
Previously Parliamentary Under-Secretary of State at Department for Exiting the European Union.
7
Minister of State jointly at Department for International Trade; does not draw salary or pension benefits.
8
Minister of State jointly at Department for Education but paid by Department for Business, Energy and Industrial Strategy; salary for
2019-20 includes £7,920 statutory payment on cessation of Ministerial office; Minister of State at Department of Health and Social Care
between 25 July 2019 and 10 September 2019.
9
Minister of State jointly at Department for Education but paid by Department for Business, Energy and Industrial Strategy; salary
includes £7,920 statutory payment on cessation of Ministerial office.
10 Salary for 2019-20 includes £7,920 statutory payment on cessation of Ministerial office.
11 Does not draw salary or pension benefits; previously Parliamentary Under-Secretary of State at Department for Education.
12 Full year equivalent salary includes £36,366 Lords Office Holders Allowance.
13 Jointly Parliamentary Under-Secretary of State at Northern Ireland Office but paid by Department for Business, Energy and Industrial
Strategy; salary includes £17,742 statutory payment on cessation of Ministerial office; full year equivalent salary includes £36,366 Lords
Office Holders Allowance; previously Parliamentary Under-Secretary of State at Scotland Office.
14 Subsequently Parliamentary Under-Secretary of State at Department for Transport
15 Full year equivalent salary includes £36,366 Lords Office Holders Allowance.
16 Parliamentary Under-Secretary of State jointly at Ministry of Housing, Communities and Local Government and paid by that Department;
subsequently Minister of State jointly at Cabinet Office and Ministry of Housing, Communities and Local Government.
17 Previously Government Whip, Lord Commissioner of HM Treasury; subsequently Minister of State jointly at Foreign and Commonwealth
Office and Department for International Development.

83
Accountability report
Ministers – pension benefits
Audited information
Pension
benefits
at age
65 as at
31 March
2020
Real
increase
in pension
at age 65
CETV at
31 March
20201
CETV at
31 March
20191
Real
increase
in CETV
£’000
£’000
£’000
£’000
£’000
Secretary of State
Rt Hon Alok Sharma MP (from 13 February 2020)
0–5
0–2.5
33
31
2
Rt Hon Andrea Leadsom MP (from 24 July 2019
to 13 February 2020)
0–5
0–2.5
64
54
5
Rt Hon Greg Clark MP (to 24 July 2019)
10–15
0–2.5
148
142
3
Ministers of State
Rt Hon Kwasi Kwarteng MP (from 24 July 2019)
0–5
0–2.5
8
3
2
Lord Grimstone (from 18 March 2020)2
–
–
–
–
–
Rt Hon Chris Skidmore MP (from 5 December 2018
to 25 July 2019 and from 10 September 2019 to
13 February 2020)
0–5
0–2.5
12
7
–
Rt Hon Jo Johnson MP (from 24 July 2019
to 5 September 2019)
0–5
0–2.5
51
50
–
Rt Hon Claire Perry MP (to 24 July 2019)
0–5
0–2.5
39
35
2
Parliamentary Under-Secretaries of State
Nadhim Zahawi MP (from 26 July 2019)3
–
–
–
–
–
Lord Callanan (from 13 February 2020)
0–5
0–2.5
62
59
3
Paul Scully MP (from 13 February 2020)
0–5
0–2.5
1
–
1
Amanda Solloway MP (from 13 February 2020)
0–5
0–2.5
1
–
1
Lord Duncan (from 26 July 2019 to 13 February 2020)
0–5
0–2.5
40
31
3
Kelly Tolhurst MP (from 19 July 2018 to 13 February
2020)
0–5
0–2.5
8
5
1
Rt Hon Lord Henley (to 26 July 2019)
0–5
–
46
45
–
Rt Hon Jake Berry MP (from 7 June 2019 to
24 July 2019)
–
–
–
–
–
Andrew Stephenson MP (from 4 April 2019 to
25 July 2019)
0–5
0–2.5
7
6
–
Notes
1
Where ministers joined or left during the year, their CETV opening or closing amounts are as at their joining or leaving dates. See Notes
to the Remuneration report for explanation of CETV.
2
Does not draw salary or pension benefits.
3
Does not draw salary or pension benefits.

84
Annual report and accounts 2019-20
Senior officials’ remuneration
Salary and pension entitlements of officials of the Core Department who were members of the
Departmental Board or Executive Committee during the year ending 31 March 2020 are set out in the
tables below.
Senior officials – single total figure of remuneration
Audited information
Where officials have moved to or from a similar senior role in another department during the year,
details of any remuneration relating to their subsequent or prior roles will be in that department’s
remuneration report.
2019-20
2018-19
Salary1
Full year
equivalent
salary if
different
Bonus
Pension2
Total
Salary1
Full year
equivalent
salary if
different
Bonus
Pension2
restated
Total
restated
£’000
£’000
£’000
to nearest
£1,000
£’000
£’000
£’000
£’000
to nearest
£1,000
£’000
Alex Chisholm
180-185
–
15-20
70
270-275
180-185
–
5-10
70
255-260
Sam Beckett
130-135
–
10-15
68
210-215
125-130
–
10-15
38
175-180
Nick Chism (from
1 June 2018 to
5 February 2020)
115-120
140-145
–
47
165-170
115-120
140-145
–
46
160-165
Julian Critchlow
(from 14 May 2018)
140-145
–
–
–
140-145
120-125
140-145
–
–
120-125
Sarah Harrison
140-145
–
10-15
67
220-225
140-145
–
–
71
210-215
John Loughhead3
130-135
–
–
67
200-205
130-135
–
–
62
190-195
Sarah Munby (from
15 July 2019)4
75-80
110-115
–
31
105-110
–
–
–
–
–
Jaee Samant
125-130
–
–
45
170-175
125-130
–
–
99
220-225
Jo Shanmugalingam
(from 15 July 2019)5
65-70
95-100
–
82
150-155
–
–
–
–
–
Joanna Whittington
(from 8 October
2018)
155-160
–
–
57
215-220
75-80
155-160
–
23
95-100
Gavin Lambert
(interim,from
15 April 2019 to
12 July 2019)
25-30
100-105
–
9
30-35
–
–
–
–
–
Sam Lister (interim,
from 15 April 2019
to 12 July 2019)6
30-35
130-135
–
13
45-50
–
–
–
–
–
Gareth Davies (to
3 May 2019)7
10-15
130-135
-
19
30-35
130-135
–
10-15
49
190-195
Tom Taylor8
125-130
–
5-10
41
180-185
125-130
–
5-10
76
210-215
Caleb Deeks
100-105
–
5-10
60
170-175
100-105
–
0-5
61
165-170
Doug Watkins (from
1 September 2018)
125-130
–
0-5
69
195-200
70-75
120-125
10-15
57
135-140
Craig Woodhouse
(from 15 July 2019)
90-95
125-130
–
36
125-130
-
–
–
–
–

85
Accountability report
Notes
1
Salary information excludes employers’ national insurance contributions. No benefits in kind or compensation for loss of office were
received by any senior officials during the year. Where officials have moved to or from a similar senior role in another department during
the year, details of any remuneration relating to their subsequent or prior roles will be in that department’s remuneration report.
2
The value of pension benefits accrued during the year is calculated as (real increase in pension multiplied by 20) plus (real increase in any
lump sum) less (contributions made by the individual). Real increase excludes increases due to inflation or any increase or decrease due
to transfer of pension rights.
3 Contracted and remunerated as 90% of full time equivalent; full time equivalent of salary is 145-150 (2018-19: 145-150).
4 Contracted and remunerated as 85% of full time equivalent; full time equivalent of full year equivalent salary is 130-135.
5 Contracted and remunerated as 85% of full time equivalent; full time equivalent of full year equivalent salary is 115-120.
6
Subsequently Director General at Department for Digital, Culture, Media and Sport.
7
Subsequently Director General at Department for Transport.
8
Pension figure for 2018-19 increased from 47 to 76 as result of retrospective update to salary data and consequently total from 180-185
to 210-215.

86
Annual report and accounts 2019-20
Senior officials – pension benefits
Audited information
Accrued
pension at
pension age
as at 31 March
2020 and
related lump
sum
Real increase
in pension
and related
lump sum at
pension age
CETV at
31 March
2020 1
CETV at
31 March
20191
restated
Real
increase
in CETV
Employer
contribution
to partnership
pension
account
£’000
£’000
£’000
£’000
£’000
Nearest £100
Alex Chisholm
30-35
2.5-5
402
332
39
–
Sam Beckett
55-60 plus lump
sum of 120-125
2.5-5 plus lump
sum of 0-2.5
1,040
947
44
–
Nick Chism (from
1 June 2018 to 5 February
2020)
5-10
2.5-5
68
32
25
–
Julian Critchlow
(from 14 May 2018) 2
–
–
–
–
–
–
Sarah Harrison
55-60
2.5-5
1,007
914
45
–
John Loughhead
15-20
2.5-5
277
224
46
–
Sarah Munby
(from 15 July 2019)
0-5
0-2.5
16
-
10
–
Jaee Samant
50-55 plus lump
sum of 110-115
2.5-5 plus lump
sum of (2.5)-0
956
886
24
–
Jo Shanmugalingam (from
15 July 2019)
20-25 plus lump
sum of 50-55
2.5-5 plus lump
sum of 5-7.5
340
284
48
–
Joanna Whittington (from 8
October 2018)
40-45 plus lump
sum of 75-80
2.5-5 plus lump
sum of (2.5)-0
745
674
31
–
Gavin Lambert (interim, from
15 April 2019 to 12 July 2019)
25-30 plus lump
sum of 50-55
0-2.5 plus lump
sum of (2.5)-0
380
374
3
–
Sam Lister (interim, from
15 April 2019 to 12 July 2019)
20-25
0-2.5
240
233
5
–
Gareth Davies (to 3 May 2019)
45-50
0-2.5
629
614
13
–
Tom Taylor 3
45-50 plus lump
sum of 100-105
2.5-5 plus lump
sum of (2.5)-0
801
743
18
–
Caleb Deeks
30-35
2.5-5
366
319
27
–
Doug Watkins
(from 1 September 2018)
60-65 plus lump
sum of 155-160
2.5-5 plus lump
sum of 2.5-5
1,244
1,139
49
–
Craig Woodhouse
(from 15 July 2019)
0-5
0-2.5
18
–
11
–
Notes
1
Where senior officials joined or left during the year, their CETV opening or closing amounts are as at their joining or leaving dates.
See Notes to the Remuneration report for explanation of CETV.
2
Not a member of Civil Service pension arrangements during the year.
3
CETV as at 31 March 2019 increased from 720 to 743 as result of retrospective update to salary data.

87
Accountability report
Fee entitlements for non-executive board members
Audited information
The table below shows fee entitlements for non-executive directors who were members of the
Departmental Board during the year ending 31 March 2020.
2019-20
2018-19
Fee
entitlement
Full year
equivalent if
different
Fee
entitlement
Full year
equivalent if
different
£’000
£’000
£’000
£’000
Archie Norman
20-25
20-25
Nigel Boardman (from 25 June 2018)
20-25
15-20
20-25
Leena Nair (from 25 June 2018)
20-25
15-20
20-25
Stephen Carter1
15-20
15-20
Dame Carolyn McCall
15-20
15-20
Kathryn Parsons
15-20
15-20
Stuart Quickenden1
15-20
15-20
Notes
1
Fee entitlement waived.
Fair pay disclosure
Audited information
The table below shows the relationship during the year ending 31 March 2020 between the
remuneration of the highest-paid director and the median remuneration of the workforce across the
Core Department and two agencies, Insolvency Service and UK Space Agency. Remuneration figures
include salary, non-consolidated performance-related pay and benefits-in-kind. They do not include
severance payments, employer pension contributions and the cash equivalent transfer value of
pensions.

2019-20
2018-19
Remuneration band of highest paid director
£200,000-£205,000
£185,000-£190,000
Median remuneration of workforce
£40,464
£38,971
Ratio of highest paid director to median
5.00
4.81
Remuneration range of workforce including directors
£17,031 to £218,484
£18,200 to £194,747
Number of people remunerated in excess of highest paid director
1
1

88
Annual report and accounts 2019-20
Notes to the Remuneration
report
The information in the Remuneration report
relates solely to the Core Department with the
exception of the Fair pay disclosure which relates
to the Core Department and two of its Agencies.
Similar information relating to chief executives
and most senior managers of the Agencies and
other bodies of the Departmental family is given
in the separate annual reports and accounts of
the relevant bodies.
Salary
‘Salary’ includes gross salary; overtime; reserved
rights to London weighting or London
allowances; recruitment and retention
allowances; private office allowances and any
other allowance to the extent that it is subject to
UK taxation. This report is based on accrued
payments made by the Department and thus
recorded in these accounts. In respect of
ministers in the House of Commons,
departments bear only the cost of the additional
ministerial remuneration; the salary for their
services as an MP (£79,468 from 1 April 2019)
and various allowances to which they are entitled
are borne centrally. However, the arrangement
for ministers in the House of Lords is different in
that they do not receive a salary but rather an
additional remuneration which cannot be
quantified separately from their ministerial
salaries. This total remuneration, as well as the
allowances to which they are entitled, is paid by
the Department and is therefore shown in full in
the figures above.
Bonuses
Bonuses are based on performance levels
attained and are made as part of the appraisal
process. Bonuses relate to the performance in
the year in which they become payable to the
individual. The bonuses reported in 2019-20
relate to performance in 2018-19 and the
comparative bonuses reported for 2018-19
relate to performance in 2017-18.
Ministerial pensions
Pension benefits for ministers are provided by
the Parliamentary Contributory Pension Fund
(PCPF). The scheme is made under statute and
the rules are set out in the Ministers’ etc Pension
Scheme 2015, available at http://qna.files.
parliament.uk/ws-attachments/170890/original/
PCPF MINISTERIAL SCHEME FINAL RULES.
doc. Those ministers who are Members of
Parliament may also accrue an MP’s pension
under the PCPF, details of which are not included
in this report. A new MP’s pension scheme was
introduced from May 2015 although members
who were MPs and aged 55 or older on 1 April
2013 have transitional protection to remain in the
previous MPs’ final salary pension scheme.
Benefits for ministers are payable from State
Pension age under the 2015 scheme. Pensions
are re-valued annually in line with Pensions
Increase legislation both before and after
retirement. The contribution rate from May 2015
is 11.1% and the accrual rate is 1.775% of
pensionable earnings. The figure shown for
pension value includes the total pension payable
to the member under both the pre- and post-
2015 ministerial pension schemes.
Ministerial pensions: Cash Equivalent
Transfer Value
The Cash Equivalent Transfer Value (CETV) is the
actuarially assessed capitalised value of the
pension scheme benefits accrued by a member
at a particular point in time. The benefits valued
are the member’s accrued benefits and any
contingent spouse’s pension payable from the
scheme. A CETV is a payment made by a
pension scheme or arrangement to secure
pension benefits in another pension scheme or
arrangement when the member leaves a scheme
and chooses to transfer the pension benefits
they have accrued in their former scheme. The
pension figures shown relate to the benefits that
the individual has accrued as a consequence of
their total ministerial service, not just their current
appointment as am minister. CETVs are
calculated in accordance with The Occupational
Pension Schemes (Transfer Values) (Amendment)
Regulations 2008 and do not take account of
any actual or potential reduction to benefits

89
Accountability report
resulting from Lifetime Allowance Tax which may
be due when pension benefits are taken.
Ministerial pensions: Real increase in the
value of the CETV
This is the element of the increase in accrued
pension funded by the Exchequer. It excludes
increases due to inflation and contributions paid
by the minister. It is worked out using common
market valuation factors for the start and end of
the period.
Civil Service pensions
Pension benefits are provided through the Civil
Service pension arrangements. From 1 April
2015 a new pension scheme for civil servants
was introduced – the Civil Servants and Others
Pension Scheme or alpha, which provides
benefits on a career average basis with a normal
pension age equal to the member’s State
Pension Age (or 65 if higher). From that date all
newly appointed civil servants and the majority of
those already in service joined alpha. Prior to that
date, civil servants participated in the Principal
Civil Service Pension Scheme (PCSPS). The
PCSPS has four sections: three providing
benefits on a final salary basis (classic, premium
or classic plus) with a normal pension age of 60;
and one providing benefits on a whole career
basis (nuvos) with a normal pension age of 65.
These statutory arrangements are unfunded with
the cost of benefits met by monies voted by
Parliament each year. Pensions payable under
classic, premium, classic plus, nuvos and alpha
are increased annually in line with Pensions
Increase legislation. Existing members of the
PCSPS who were within 10 years of their normal
pension age on 1 April 2012 remained in the
PCSPS after 1 April 2015. Those who were
between 10 years and 13 years and 5 months
from their normal pension age on 1 April 2012
will switch into alpha sometime between 1 June
2015 and 1 February 2022. All members who
switch to alpha have their PCSPS benefits
‘banked’, with those with earlier benefits in one
of the final salary sections of the PCSPS having
those benefits based on their final salary when
they leave alpha. (The pension figures quoted for
officials show pension earned in PCSPS or alpha
– as appropriate. Where the official has benefits
in both the PCSPS and alpha the figure quoted
is the combined value of their benefits in the two
schemes.) Members joining from October 2002
may opt for either the appropriate defined benefit
arrangement or a ‘money purchase’ stakeholder
pension with an employer contribution
(partnership pension account).
Employee contributions are salary-related and
range between 4.6% and 8.05% for members of
classic, premium, classic plus, nuvos and alpha.
Benefits in classic accrue at the rate of 1/80th of
final pensionable earnings for each year of
service. In addition, a lump sum equivalent to
three years’ initial pension is payable on
retirement. For premium, benefits accrue at the
rate of 1/60th of final pensionable earnings for
each year of service. Unlike classic, there is no
automatic lump sum. classic plus is essentially a
hybrid with benefits for service before 1 October
2002 calculated broadly as per classic and
benefits for service from October 2002 worked
out as in premium. In nuvos a member builds up
a pension based on their pensionable earnings
during their period of scheme membership.
At the end of the scheme year (31 March) the
member’s earned pension account is credited
with 2.3% of their pensionable earnings in that
scheme year and the accrued pension is uprated
in line with Pensions Increase legislation. Benefits
in alpha build up in a similar way to nuvos,
except that the accrual rate in 2.32%. In all
cases members may opt to give up (commute)
pension for a lump sum up to the limits set by
the Finance Act 2004.
The partnership pension account is a
stakeholder pension arrangement. The employer
makes a basic contribution of between 8% and
14.75% (depending on the age of the member)
into a stakeholder pension product chosen by
the employee from a panel of providers. The
employee does not have to contribute, but where
they do make contributions, the employer will
match these up to a limit of 3% of pensionable
salary (in addition to the employer’s basic
contribution). Employers also contribute a further
0.5% of pensionable salary to cover the cost of

90
Annual report and accounts 2019-20
centrally-provided risk benefit cover (death in
service and ill health retirement).
The accrued pension quoted is the pension the
member is entitled to receive when they reach
pension age, or immediately on ceasing to be an
active member of the scheme if they are already
at or over pension age. Pension age is 60 for
members of classic, premium and classic plus,
65 for members of nuvos, and the higher of 65
or State Pension Age for members of alpha. (The
pension figures quoted for officials show pension
earned in PCSPS or alpha – as appropriate.
Where the official has benefits in both the
PCSPS and alpha the figure quoted is the
combined value of their benefits in the two
schemes but note that part of that pension may
be payable from different ages.)
Further details about the Civil Service pension
arrangements can be found at the website
https://www.civilservicepensionscheme.org.uk/.
Civil Service pensions: Cash Equivalent
Transfer Value
The Cash Equivalent Transfer Value (CETV) is the
actuarially assessed capitalised value of the
pension scheme benefits accrued by a member
at a particular point in time. The benefits valued
are the member’s accrued benefits and any
contingent spouse’s pension payable from the
scheme. A CETV is a payment made by a
pension scheme or arrangement to secure
pension benefits in another pension scheme or
arrangement when the member leaves a scheme
and chooses to transfer the benefits accrued in
their former scheme. The pension figures shown
relate to the benefits that the individual has
accrued as a consequence of their total
membership of the pension scheme, not just
their service in a senior capacity to which
disclosure applies.
The figures include the value of any pension
benefit in another scheme or arrangement which
the member has transferred to the Civil Service
pension arrangements. They also include any
additional pension benefit accrued to the
member as a result of their buying additional
pension benefits at their own cost. CETVs are
worked out in accordance with The Occupational
Pension Schemes (Transfer Values) (Amendment)
Regulations 2008 and do not take account of
any actual or potential reduction to benefits
resulting from Lifetime Allowance Tax which may
be due when pension benefits are taken.
Civil Service pensions: Real increase in
CETV
This reflects the increase in CETV that is funded
by the employer. It does not include the increase
in accrued pension due to inflation, contributions
paid by the employee (including the value of any
benefits transferred from another pension
scheme or arrangement) and uses common
market valuation factors for the start and end of
the period.

91
Accountability report
Statement of Parliamentary Supply
Audited information
Overview
In addition to the primary statements prepared
under IFRS, the Government Financial Reporting
Manual (FReM) requires the Department for
Business, Energy and Industrial Strategy to
prepare a Statement of Parliamentary Supply
(SoPS) and supporting notes.
The SoPS and related notes are subject to audit,
as detailed in the Certificate and Report of the
Comptroller and Auditor General to the House of
Commons.
The SoPS is a key accountability statement that
shows, in detail, how an entity has spent against
their Supply Estimate. Supply is the monetary
provision (for resource and capital purposes) and
cash (drawn primarily from the Consolidated
Fund), that Parliament gives statutory authority for
entities to utilise. The Estimate details supply and
is voted on by Parliament at the start of the
financial year.
Should an entity exceed the limits set by their
Supply Estimate, called control limits, their
accounts will receive a qualified opinion.
The format of the SoPS mirrors the Supply
Estimates, published on gov.uk, to enable
comparability between what Parliament approves
and the final outturn.
The SoPS contain a summary table, detailing
performance against the control limits that
Parliament have voted on, cash spent (budgets
are compiled on an accruals basis and so outturn
will not tie directly to cash spent) and
administration.
Non-voted Budgets generally comprise CFERs
(Consolidated Fund Extra Receipts) that represent
operating income or expenditure financed directly
from the Consolidated Fund as a standing service
or from the National Insurance Fund. Non-voted
expenditure does not require Parliamentary
authority, but is included within budgets set by
HMT for completeness.
Estimates and Outturn spend are disclosed gross
(gross expenditure and income) for activities of
the Core Department and net for the activities of
the Departmental Group’s arm’s length bodies.
The supporting notes on pages 94 to 101 detail
the following: Outturn by Estimate line, providing
a more detailed breakdown (note 1); a
reconciliation of Outturn to Net operating
expenditure in the SoCNE, to tie the SoPS to the
financial statements (note 2); a reconciliation of
Outturn to Net cash requirement (note 3); and, an
analysis of income payable to the Consolidated
Fund (note 4).

92
Annual report and accounts 2019-20
Summary table 2019-20
SoPS
note
2019-20
2018-19
Outturn
Estimate
Outturn vs Estimate:
saving/ (excess)
Outturn total
Voted
Non-voted
Total
Voted
Non-voted
Total
Voted
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Departmental Expenditure Limit
Resource
1.1
3,586,479
(748,104)
2,838,375
4,402,890
(848,000)
3,554,890
816,411
716,515
1,246,489
Capital
1.2
11,227,917
-
11,227,917
11,842,219
(7,000)
11,835,219
614,302
607,302
10,813,932
Total DEL
14,814,396
(748,104)
14,066,292
16,245,109
(855,000)
15,390,109
1,430,713
1,323,817
12,060,421
Annually Managed Expenditure
Resource
1.1
19,483,001
431,123
19,914,124
14,588,019
467,000
15,055,019
(4,894,982)
(4,859,105)
(105,864,889)
Capital
1.2
5,500
(142,400)
(136,900)
865,249
(142,400)
722,849
859,749
859,749
(416,665)
Total AME
19,488,501
288,723
19,777,224
15,453,268
324,600
15,777,868
(4,035,233)
(3,999,356)
(106,281,554)
Total Budget
34,302,897
(459,381)
33,843,516
31,698,377
(530,400)
31,167,977
(2,604,520)
(2,675,539)
(94,221,133)
Resource
1.1
23,069,480
(316,981)
22,752,499
18,990,909
(381,000)
18,609,909
(4,078,571)
(4,142,590)
(104,618,400)
Capital
1.2
11,233,417
(142,400)
11,091,017
12,707,468
(149,400)
12,558,068
1,474,051
1,467,051
10,397,267
Total Budget
34,302,897
(459,381)
33,843,516
31,698,377
(530,400)
31,167,977
(2,604,520)
(2,675,539)
(94,221,133)
Non-budget expenditure
299,766
–
299,766
340,682
–
340,682
40,916
40,916
–
Total Budget and non-
budget
34,602,663
(459,381)
34,143,282
32,039,059
(530,400)
31,508,659
(2,563,604)
(2,634,623)
(94,221,133)
Figures in the areas outlined in a thick line cover the voted control limits voted by Parliament. Refer to the Supply Estimates guidance
manual, available on gov.uk, for detail on the control limit voted by Parliament.
Significant variances between Outturn and the Estimate are explained in the financial review on pages 29 to 38.
The Department has incurred an Excess of £9.7 billion in relation to voted Resource Annually Managed Expenditure for the Estimate Line:
Deliver an ambitious industrial strategy in SoPS 1.1 due to COVID-19 emergency interventions by the Government, namely the Small
Business Grant Fund and the Retail, Hospitality and Leisure Grant Fund. Due to the timing of the COVID-19 response in March 2020, this
expenditure was incurred without the necessary parliamentary approval by way of a Supplementary Estimate. Further information in
relation to these schemes can be seen on note 18 and note 28 of the accounts. This has led to a total Excess of Resource AME of £4.9
billion. The Department will seek parliamentary approval by way of an Excess Vote in the next Supply and Appropriation Act.

93
Accountability report
Net cash requirement 2019-20
2019-20
2018-19
SoPS
note
Outturn
Estimate
Outturn vs
Estimate: saving/
(excess)
Outturn total
£’000
£’000
£’000
£’000
Net cash requirements
3
15,708,936
18,171,944
2,463,008
13,787,150
Administration costs 2019-20
2019-20
2018-19
SoPS
note
Outturn
Estimate
Outturn vs
Estimate: saving/
(excess)
Outturn total
£’000
£’000
£’000
£’000
Administration costs
1.1
502,428
538,798
36,370
460,580
Although not a separate voted limit, any breach of the administration budget, will also result in an
excess vote.

94
Annual report and accounts 2019-20
Notes to the SoPS, 2019-20
Audited information

SOPS note 1. Outturn detail, by Estimate Line
SoPS 1.1 Analysis of Resource Outturn by Estimate Line
2019-20
2018-19
Resource Outturn
Estimate
Outturn vs
Estimate:
saving/
(excess)
Resource
Outturn
Administration
Programme
Total
Total Virements
Total inc.
virements
Total
Gross
Income
Net
Gross
Income
Net
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Resource spending in DEL: voted expenditure
A
Deliver an ambitious industrial strategy
–
–
–
924,328
(15,803)
908,525
908,525
1,464,590
–
1,464,590
556,065
182,286
B
Maximise investment opportunities and
bolster UK interests
–
–
–
73,644
(419)
73,225
73,225
65,206
8,019
73,225
–
70,705
C
Promote competitive markets and
responsible business practices
784
–
784
121,242
(18,038)
103,204
103,988
103,801
187
103,988
–
94,443
D
Delivering affordable energy for households
and businesses
–
–
–
38,976
(2)
38,974
38,974
39,532
–
39,532
558
44,155
E
Ensuring that our energy system is reliable
and secure
–
–
–
12,554
(7,831)
4,723
4,723
11,586
–
11,586
6,863
4,756
F
Taking action on climate change and
decarbonisation
–
–
–
32,664
(146)
32,518
32,518
29,693
2,825
32,518
–
24,829
G
Managing our energy legacy safely and
responsibly
–
–
–
234,205
(19)
234,186
234,186
236,758
(2,572)
234,186
–
251,870
H
Science and Research
(2)
–
(2)
6,177
(16)
6,161
6,159
34
6,125
6,159
–
4,608
I
Capability
404,986
(20,752)
384,234
31,542
(185)
31,357
415,591
496,254
(60,120)
436,134
20,543
393,848
J
Government as Shareholder
4,326
(17)
4,309
133,303
(123,994)
9,309
13,618
101,237
–
101,237
87,619
62,819
K
Deliver an ambitious industrial strategy
(ALB) net
–
–
–
21,077
–
21,077
21,077
22,000
–
22,000
923
15,147
L
Promote competitive markets and
responsible business practices (ALB) net
7,779
–
7,779
46,964
–
46,964
54,743
54,978
–
54,978
235
54,635
M
Ensuring that our energy system is reliable
and secure (ALB) net
–
–
–
(2,756)
–
(2,756)
(2,756)
1
–
1
2,757
(2,667)
N
Taking action on climate change and
decarbonisation (ALB) net
5,354
–
5,354
2,906
–
2,906
8,260
5,055
3,205
8,260
–
6,069

95
Accountability report
2019-20
2018-19
Resource Outturn
Estimate
Outturn vs
Estimate:
saving/
(excess)
Resource
Outturn
Administration
Programme
Total
Total Virements
Total inc.
virements
Total
Gross
Income
Net
Gross
Income
Net
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
O
Managing our energy legacy safely and
responsibly (ALB) net
4,833
–
4,833
23,886
–
23,886
28,719
23,857
4,862
28,719
–
32,075
P
Science and Research (ALB) net
7,410
–
7,410
223,755
–
223,755
231,165
274,998
(6,125)
268,873
37,708
276,226
Q
Capability (ALB) net
34,693
–
34,693
–
–
–
34,693
1,500
33,193
34,693
–
30,475
R
Government as Shareholder (ALB) net
105
–
105
48,748
–
48,748
48,853
38,452
10,401
48,853
–
(19,479)
S
NDA and SLC expenditure (ALB) net
52,929
–
52,929
1,277,289
–
1,277,289
1,330,218
1,433,358
–
1,433,358
103,140
1,175,337
Total voted DEL
523,197
(20,769)
502,428
3,250,504
(166,453)
3,084,051
3,586,479
4,402,890
–
4,402,890
816,411
2,702,137
Resource spending in DEL: non-voted expenditure
T
Nuclear Decommissioning Authority
Income (CFER)
–
–
–
–
(748,104)
(748,104)
(748,104)
(848,000)
–
(848,000)
(99,896)
(978,373)
Nuclear Safeguards Development
–
–
–
–
–
–
–
–
–
–
–
(2,275)
Managing our energy legacy safely and
responsibly (CFER)
–
–
–
–
–
–
–
–
–
–
–
(475,000)
Total non-voted DEL
–
–
–
– (748,104)
(748,104)
(748,104)
(848,000)
–
(848,000)
(99,896)
(1,455,648)
Total resource spending in DEL
523,197
(20,769)
502,428
3,250,504
(914,557)
2,335,947
2,838,375
3,554,890
–
3,554,890
716,515
1,246,489
Resource spending in AME: voted expenditure
U
Deliver an ambitious industrial strategy
–
–
– 10,758,343
(25,154)
10,733,189
10,733,189
1,048,811
(17,702)
1,031,109
9,702,080
(312,599)
V
Maximise investment opportunities and
bolster UK interests
–
–
–
701
–
701
701
5,000
–
5,000
4,299
6,044
W
Promote competitive markets and
responsible business practices
–
–
–
72,052
–
72,052
72,052
72,000
52
72,052
–
79,000
X
Ensuring that our energy system is reliable
and secure
–
–
–
–
478
478
478
1
477
478
–
(295)
Y
Managing our energy legacy safely and
responsibly
–
–
–
(173,978)
(29,419)
(203,397)
(203,397)
(67,956)
(78,370)
(146,326)
57,071
(297,497)
Z
Science and Research
–
–
–
54,912
–
54,912
54,912
91,252
–
91,252
36,340
205,985
AA
Capability
–
–
–
(55,895)
–
(55,895)
(55,895)
(50,581)
–
(50,581)
5,314
(12,990)
AB
Government as Shareholder
–
–
–
17,149
(6,913)
10,236
10,236
(5,874)
16,110
10,236
–
1,035
AC
Renewable Heat Incentive
–
–
–
846,092
–
846,092
846,092
1,010,000
–
1,010,000
163,908
817,898
AD
Deliver an ambitious industrial strategy
(ALB) net
–
–
–
36,202
–
36,202
36,202
18,500
17,702
36,202
–
(21,100)

96
Annual report and accounts 2019-20
2019-20
2018-19
Resource Outturn
Estimate
Outturn vs
Estimate:
saving/
(excess)
Resource
Outturn
Administration
Programme
Total
Total Virements
Total inc.
virements
Total
Gross
Income
Net
Gross
Income
Net
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
AE
Promote competitive markets and
responsible business practices (ALB) net
–
–
–
973
–
973
973
811
162
973
–
57
AF
Taking action on climate change and
decarbonisation (ALB) net
–
–
–
3,543,428
–
3,543,428
3,543,428
6,599,928
(1,230)
6,598,698
3,055,270
(2,971,284)
AG
Managing our energy legacy safely and
responsibly (ALB) net
–
–
–
22,826
–
22,826
22,826
17,616
5,210
22,826
–
(2,022,249)
AH
Science and Research (ALB) net
–
–
–
149,372
–
149,372
149,372
76,212
73,160
149,372
–
41,299
AI
Capability (ALB) net
–
–
–
4
–
4
4
(535)
539
4
–
1
AJ
Government as Shareholder (ALB) net
–
–
–
(99,851)
–
(99,851)
(99,851)
23,834
(16,110)
7,724
107,575
93,768
AK
Nuclear Decommissioning Authority
(ALB) net
–
–
–
4,371,679
–
4,371,679
4,371,679
5,749,000
–
5,749,000
1,377,321
(101,791,292)
Total voted AME
–
–
– 19,544,009
(61,008)
19,483,001
19,483,001 14,588,019
– 14,588,019
(4,894,982)
(106,184,219)
Resource spending in AME: non-voted expenditure
AM
Government as Shareholder
–
–
–
438,858
(7,735)
431,123
431,123
467,000
–
467,000
35,877
319,330
Total non-voted AME
–
–
–
438,858
(7,735)
431,123
431,123
467,000
–
467,000
35,877
319,330
Total resource spending in AME
–
–
– 19,982,867
(68,743)
19,914,124
19,914,124 15,055,019
– 15,055,019
(4,859,105)
(105,864,889)
Total resource spending
523,197
(20,769)
502,428
23,233,371
(983,300)
22,250,071
22,752,499 18,609,909
– 18,609,909
(4,142,590)
(104,618,400)
Non-budget: voted
Prior Period Adjustments
–
–
–
299,766
–
299,766
299,766
340,682
–
340,682
40,916
–
Total resource and non-budget spending
523,197
(20,769)
502,428
23,533,137
(983,300)
22,549,837
23,052,265 18,950,591
– 18,950,591
(4,101,674)
(104,618,400)
The total Estimate columns include virements. Virements are the allocation of provision in the Estimates that do not require parliamentary authority (because Parliament does not vote to that level of detail and
delegates to HM Treasury). Further information on virements are provided in the Supply Estimates manual, available on gov.uk.
Significant variances between Outturn and Estimate are explained in the financial review on pages 29 to 38.
The Outturn vs Estimate column is based on the total including virements. The estimate total before virements have been made is included so that users can tie the estimate back to the Estimates laid before
Parliament.
2019-20 Outturn figures differ slightly from those shown in the Statement of Parliamentary Supply as this table includes a prior period adjustment for Fleetbank Funding and BIS (Postal Services Act 2011)
Company Limited as a non-budget item due to an update in the classification of transactions. Further details are given in note 26.
The Department has Prior Period Adjustments (PPAs) as a result of recognising the capital spend in an arm’s length body following its consolidation into the Departmental boundary. It is proper for the
department to seek parliamentary authority for the provision that should have been sought previously. In 2019-20, the following such PPAs have been made, which have been included within voted Supply in
the Estimate.

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Accountability report
SoPS 1.2. Analysis of capital Outturn by Estimate line
2019-20
2018-19
Capital Outturn
Estimate outturn vs
Estimate,
savings/
(excess)
Capital
Outturn
Gross
Income
Net total
Total Virements
Total inc.
virements
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Capital spending in DEL: voted expenditure
A
Deliver an ambitious
industrial strategy
340,134
(354,574)
(14,440)
24,046
–
24,046
38,486
(54,606)
B
Maximise investment
opportunities and
bolster UK interests
276,255
(10,383)
265,872
271,640
–
271,640
5,768
243,957
C
Promote competitive
markets and
responsible business
practices
3,861
–
3,861
4,666
–
4,666
805
2,682
D
Delivering affordable
energy for households
and businesses
44,702
(200)
44,502
39,988
4,514
44,502
–
32,718
E
Ensuring that our
energy system is
reliable and secure
291
–
291
430
–
430
139
(626)
F
Taking action on
climate change and
decarbonisation
156,962
(2,735)
154,227
251,585
–
251,585
97,358
73,121
G
Managing our energy
legacy safely and
responsibly
3,600
(139)
3,461
4,102
–
4,102
641
4,278
H
Science and Research
754,310
(62,516)
691,794
727,786
–
727,786
35,992
563,177
I
Capability
19,703
–
19,703
121,340
(4,577)
116,763
97,060
30,305
J
Government as
Shareholder
111,431
(47,204)
64,227
13,797
50,430
64,227
–
175,871
L
Promote competitive
markets and
responsible business
practices (ALB) net
1,193
–
1,193
1,160
33
1,193
–
1,059
N
Taking action on
climate change and
decarbonisation (ALB)
net
27
–
27
399
–
399
372
255
O
Managing our energy
legacy safely and
responsibly (ALB) net
12,919
–
12,919
14,650
–
14,650
1,731
9,503
P
Science and Research
(ALB) net
7,786,590
–
7,786,590
7,859,518
–
7,859,518
72,928
7,530,042
Q
Capability (ALB) net
30
–
30
–
30
30
–
2,482
R
Government as
Shareholder (ALB) net
396,476
–
396,476
697,112
(50,430)
646,682
250,206
197,015
S
NDA and SLC
expenditure (ALB) net
1,797,184
–
1,797,184
1,810,000
–
1,810,000
12,816
2,002,699
Total voted DEL
11,705,668
(477,751)
11,227,917 11,842,219
– 11,842,219
614,302
10,813,932
Capital spending in DEL: non-voted expenditure
T
Nuclear
Decommissioning
Authority Income
(CFER)
–
–
–
(7,000)
–
(7,000)
(7,000)
–

98
Annual report and accounts 2019-20
2019-20
2018-19
Capital Outturn
Estimate outturn vs
Estimate,
savings/
(excess)
Capital
Outturn
Gross
Income
Net total
Total Virements
Total inc.
virements
Total
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Total non-voted DEL
–
–
–
(7,000)
–
(7,000)
(7,000)
–
Total capital spending
in DEL
11,705,668
(477,751)
11,227,917 11,835,219
– 11,835,219
607,302
10,813,932
Capital spending in AME: voted expenditure
Y
Managing our energy
legacy safely and
responsibly
29,419
–
29,419
29,419
–
29,419
–
35,412
Z
Science and Research
1,263
–
1,263
–
1,263
1,263
–
1,212
AB
Government as
Shareholder
5,379,000
(5,342,000)
37,000
800,000
–
800,000
763,000
(120,000)
AD
Deliver an ambitious
industrial strategy
(ALB) net
365
–
365
32,900
–
32,900
32,535
(16,387)
AH
Science and Research
(ALB) net
(59,496)
–
(59,496)
4,000
(1,263)
2,737
62,233
(59,692)
AJ
Government as
Shareholder (ALB) net
(3,051)
–
(3,051)
(1,070)
–
(1,070)
1,981
(115,399)
Total voted AME
5,347,500
(5,342,000)
5,500
865,249
–
865,249
859,749
(274,854)
Capital spending in AME: non-voted expenditure
AL
Managing our energy
legacy safely and
responsibly (CFER)
–
(142,400)
(142,400)
(142,400)
–
(142,400)
–
(141,811)
Total non-voted AME
–
(142,400)
(142,400)
(142,400)
–
(142,400)
–
(141,811)
Total capital spending in
AME
5,347,500
(5,484,400)
(136,900)
722,849
–
722,849
859,749
(416,665)
Non-budget
Prior period
adjustments
–
–
–
–
–
–
–
–
Total capital and non-
budget spending
17,053,168
(5,962,151)
11,091,017 12,558,068
– 12,558,068
1,467,051
10,397,267
The total Estimate columns include virements. Virements are the allocation of provision in the
Estimates that do not require parliamentary authority (because Parliament does not vote to that level
of detail and delegates to HM Treasury).
Further information on virements are provided in the Supply Estimates manual, available on
gov.uk.
Significant variances between Outturn and Estimate are explained in the financial review on pages 29
to 38.

99
Accountability report
SoPS note 2. Reconciliation of outturn to net operating expenditure
As noted in the overview to the SoPS, Outturn and the Estimates are compiled against the budgeting
framework – which is similar to, but different from IFRS. Therefore, this reconciliation bridges the
resource Outturn to Net operating expenditure, linking the SoPS to the financial statements.
The prior year comparatives present the Net operating expenditure as reported at 31 March 2019.
2019-20
2018-19
SoPS
note
Outturn total
£’000
Outturn total
£’000
Total resource Outturn in Statement of Parliamentary Supply
SoPS
1.1
23,052,265
(104,618,400)
Add:
NDA remedial decommissioning costs which are capital in
budgets but taken through the SoCNE
1,797,204
2,002,699
Capital Grants
1,411,680
1,507,472
Share of profit/loss of joint ventures and associates
5,763
(187,156)
Other non-budget
176,418
(43,793)
Research and Development costs
7,800,260
7,405,902
Total
34,243,590
(93,933,276)
Less:
Non-budgetary income
(4,032)
–
Non-budget, non voted items in respect of BIS (Postal Services Act
2011) Company Limited and B Company Limited
(23)
(42,930)
Expected return on pension scheme assets
(39,265)
(40,825)
NDA income scored in SoPS only
30,243
126,783
Capital Income in SoCNE
(32,758)
(54,521)
Research and Development income
(467,966)
(488,889)
CFER: other income
–
–
Prior period adjustments
(299,766)
–
Other:
Impact of intra group transactions
23,060
60,583
Other differences
39,284
12,814
Total
(751,223)
(426,985)
Net Expenditure for the period in Consolidated
Statement of Comprehensive Net Expenditure
SoCNE
33,492,367
(94,360,261)

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Annual report and accounts 2019-20
SoPS note 3. Reconciliation of Net resource Outturn to Net cash
requirement
As noted in the overview to the SoPS, Outturn and the Estimates are compiled against the budgeting
framework – not on a cash basis. Therefore, this reconciliation bridges the resource and capital
Outturn to the Net cash requirement.
2019-20
SoPS
note
Outturn
£’000
Estimate
£’000
Outturn vs
Estimate:
saving/
(excess)
£’000
Total resource Outturn
SoPS
1.1
23,052,265
18,950,591
(4,101,674)
Total capital Outturn
SoPS
1.2
11,091,017
12,558,068
1,467,051
Adjustments for ALBs
Remove voted resource and capital
(19,711,841)
(24,758,234)
(5,046,393)
Removal of intra-group transactions
57,322
(57,322)
Add cash in grant-in-aid
11,307,613
12,000,006
692,393
Add share purchase and loans
67,506
–
(67,506)
Less share capital repayment
(8,534)
–
8,534
Adjustments to remove non-cash items
Depreciation
39,540
(32,146)
(71,686)
New provisions and adjustments to previous provisions
(10,767,459)
(1,274,604)
9,492,855
Prior Period Adjustments
(299,766)
(340,682)
(40,916)
Other non-cash items
(69,322)
74,932
144,254
Adjustments to reflect movements in working balances
Increase/(decrease) in receivables
(82,758)
50,000
132,758
(Increase)/decrease in payables
311,841
147,770
(164,071)
Use of provisions
248,501
265,843
17,342
Financial guarantees called in
13,630
–-
(13,630)
Total
(18,893,727)
(13,867,115)
5,026,612
Removal of non-voted budget items
Other non-voted budget items
459,381
530,400
71,019
Total
459,381
530,400
71,019
Net cash requirement
15,708,936
18,171,944
2,463,008

101
Accountability report
SoPS note 4. Amounts of income to the Consolidated Fund
SopS 4.1 Analysis of income payable to the Consolidated Fund
In addition to the cash retained by the Department, the following income is payable to the
consolidated fund (cash receipts being shown in italics).
The type of income allowed to be retained by the Department is set out in the ambit of the Supply
Estimate. Income of a type not included in the Estimate, or in excess of amounts agreed with
HM Treasury, is required to be surrendered to the Consolidated Fund. This includes the commercial
income of the Nuclear Decommissioning Authority, Coal Pension surpluses and income generated by
the BIS (Postal Services Act 2011) Company, which forms the bulk of the amounts shown above,
together with other miscellaneous receipts.
2019-20
Outturn total
2018-19
Outturn total
accruals
£’000
cash basis
£’000
accruals
£’000
cash basis
£’000
Operating income of the NDA within the Ambit
623,962
556,000
654,497
654,497
Income outside the ambit of the Estimate
142,945
142,945
193,362
193,362
[Excess] cash surrenderable to the Consolidated Fund
142,400
142,400
617,400
617,400
Total amount payable to the Consolidated Fund
909,307
841,345
1,465,259
1,465,259
SoPS 4.2: Consolidated Fund income
BEIS also collects income as an agent for the consolidated fund. This income is disclosed separately
in the Trust Statement, pages 231 to 241, and is not included in SoPS 4.1 – income payable to the
consolidated fund.
Details are also provided in the individual accounts of the Insolvency Service for items which are not
included in note 4.1.

102
Annual report and accounts 2019-20
Parliamentary accountability disclosures
Losses and special payments
Audited information
The disclosures in this note are in accordance with Managing Public Money, the official guidance on
handling public funds.
Losses statement
2019-20
2018-19
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Total number of losses
11,986
12,300
8,955
9,719
RPS receivable impairment (£m)
446
446
358
358
Other losses (£m)
30
35
27
28
Total value of losses (£m)
476
481
385
386
Details of cases over £300,000: constructive
losses: Core Department
The Core Department holds onerous leases for
properties on the Department’s estate for which
£54 million has been provided as at 31 March
2020 (31 March 2019: £113 million); payments
in 2019-20 totalled £16.8 million (2018-19:
£26.6 million).
Details of cases over £300,000: claims
written‑off due to insolvency: Core Department
In April 2019 HMG entered into a commercial
agreement with British Steel to allow it to meet
its EU ETS obligations. Under a Deed of
Forfeiture HMG bought £119 million of EU ETS
allowances to meet British Steel’s 2018 EU ETS
liability. The Deed of Forfeiture stipulated
transaction and arrangement fees of £12 million
to be paid by British Steel Limited to the
Department. As British Steel filed for compulsory
liquidation on 22 May 2019, the £12 million in
fees are unlikely to be recoverable and have
therefore been written-off.
Details of cases over £300,000: claims
abandoned: Agencies
Redundancy Payment Service (RPS) receivable
impairment: most of the redundancy payments
made from the National Insurance Fund (NIF) are
in respect of employees of insolvent companies.
Repayment of debt is recovered from the sale of
the assets of the insolvent company. A small
proportion of the debt (11%) is preferential, and
as such has a higher recovery rate. HMRC
record the impairment of the RPS receivable in
NIF accounts. The RPS receivable impairment for
2019-20 is £446 million (2018-19: £358 million).

103
Accountability report
Special payments
Special payments include extra-contractual, ex gratia, compensation and special severance
payments.
2019-20
2018-19
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Total number of special payments
410
417
6
13
Total value of special payments (£m)
1
1
–
2
Details of cases over £300,000
In connection with the withdrawal of a court
action, the Core Department agreed to meet
£600,000 of the claimant’s legal costs.
Gifts and hospitality
Managing Public Money states that annual
reports should include a note on gifts made by
departments if their total value exceeds
£300,000. Gifts with a value of more than
£300,000 should be noted individually. During
2019-20, the Core Department did not give, nor
did it receive, any reportable gifts above
£300,000.
The Core Department’s gifts and hospitality
policy expects the highest level of standards of
behaviour from civil servants when deciding
whether to accept or decline gifts and hospitality
offered, as set out within the Civil Service Code
and Managing Public Money. There are also
constraints in giving hospitality to ensure that
claims are proportionate, necessary, justifiable,
modest, and defensible under public scrutiny
and delivering value for money from the use of
public funds.
The policy applies to BEIS’s Civil Service staff,
contractors, agents, and non-executive directors
who are bound by the Civil Service Code. This
policy does not apply to Ministers and special
advisers who are covered under the Ministerial
Code and Cabinet Office Code of Conduct for
Special Advisers respectively. Additionally,
Special Advisors gifts and hospitality registers
are published on a quarterly basis, including nil
returns.
Fees and charges
Audited information
The Core Department provides a limited number
of services for which it charges fees. Any such
fees are set to comply with the cost allocation
and charging requirements set out in HM
Treasury and Office of Public Sector Information
guidance.
The Insolvency Service sets its fees to recover
costs; it has a range of fees covering four areas:
• case administration: the average costs of
administering bankruptcy cases, compulsory
company liquidation cases and completing
debt relief orders;
• insolvency practitioner regulations: the cost of
authorising and monitoring insolvency
practitioners and registering individual
voluntary arrangements;
• estate accounting: the cost of financial
transactions on insolvency cases using the
Insolvency Service account; and
• debt relief orders: the cost of considering an
application for a debt relief order by the Official
Receiver.
Details of charging polices relating to partner
organisations may be found in their respective
published accounts.

104
Annual report and accounts 2019-20
Remote contingent liabilities
Audited information
The Departmental Group has entered into the
following contingent liabilities by offering
guarantees, indemnities or letters of comfort.
None of these is a contingent liability within the
meaning of IAS 37, as the likelihood of a transfer
of economic benefit in settlement is too remote.
However, they are required to be disclosed under
the requirements of the Government Financial
Reporting Manual and Managing Public Money.
Detail of quantifiable and unquantifiable remote
contingent liabilities is presented in the sections
below.
Quantifiable
Measurement of quantifiable contingent liabilities
is carried out following the requirements of IAS
37, given the reporting requirements of Managing
Public Money. Managing Public Money requires
that the full potential costs of such contracts be
reported to Parliament.
1 April
2019
Increase /
(Decrease)
in year
Liabilities
crystallised
in year
Obligations
expired in
year
31 March
2020
Amount
reported to
Parliament by
Departmental
Minute
£m
£m
£m
£m
£m
£m
The Core Department has
indemnified Cornwall Council for
any liability relating to the European
Regional Development Fund
(ERDF) that might arise from the
transfer of Wave Hub due to (a)
any breach of the ERDF Funding
Agreements which occurred on
or before the transfer date of 31
March 2017 and (b) any action or
omission by the Core Department or
Wave Hub in relation to the ERDF
Funding Agreements prior to the
transfer which leads to finding of
an Irregularity by any competent
authority.
18
–
–
–
18
18
The Core Department has
indemnified the Coal Authority
against potential claims arising
from remunerated advisory work
undertaken for other public sector
bodies where settlement exceeds
the Authority’s professional indemnity
insurance.
3
–
–
–
3
–
Total
21
–
–
–
21
18

105
Accountability report
Unquantifiable remote contingent liabilities:
Core Department
Statutory guarantees
• Under section 9 of the British Aerospace Act
1980, the government is liable to discharge
any outstanding liability of BAE Systems plc
which vested in the company on 1 January
1981 in the event of its being wound up other
than for the purpose of reconstruction or
amalgamation.
Statutory indemnities
• Indemnities have been given to UK Atomic
Energy Authority to cover certain indemnities
provided by the Authority to carriers and
British Nuclear Fuels plc against certain claims
for damage caused by nuclear matter in the
course of carriage.
• Indemnities have been given to bankers of the
Insolvency Service against certain liabilities
arising in respect of non-transferable “account
payee” cheques due to insolvent estates and
paid into the Insolvency Service’s account.
• Indemnity has been given to National Grid’s
liabilities with regards to the interconnector
linking the UK and France.
Intellectual property
• A liability to the European Patent Office could
arise under Article 40 of the European Patent
Convention of 1973 as the UK is one of the
contracting states.
• A liability to the World Intellectual Property
Organisation could arise under Article 57 of
the Patent Cooperation Treaty as the UK is
one of the contracting states.
Data usage indemnities
• An indemnity has been provided to Pöyry PLC
relating to the use of their yield curve data for
the sale of Green Investment Bank. The Core
Department has indemnified Pöyry PLC for
any liability that occurs as a result of using
their information in the sale process that may
be brought by bidders in relation to the
transaction.
Legal costs
• A contingent liability exists in relation to various
ongoing legal cases. The cost is dependent on
the outcome of cases which currently cannot
be reliably estimated.
• Under an agreement with the Financial
Reporting Council, if the amount held in the
Council’s legal costs fund falls below £1 million
in any year, an additional grant will be made
to cover legal costs subsequently incurred in
that year.
Indemnities against personal liability
• Indemnities have been given to the directors
appointed by the Core Department to wholly
owned subsidiaries. These indemnities are
against personal liability following any legal
action against the companies.
• Indemnities have been provided to directors
appointed to the Low Carbon Contracts
Company Limited and Electricity Settlements
Company Limited against personal liability
following any legal action against the
companies, to be triggered only after all other
means have been exhausted i.e. company and
directors’ insurance and recovery of costs
through their levies.
• Indemnities have been provided to the Low
Carbon Contracts Company Limited and
Electricity Settlements Company Limited in
respect of their officers, to be triggered only
after all other means have been exhausted
i.e. company and directors’ insurance and
recovery of costs through their levies.
• Indemnities have been provided to trustees of
the Nuclear Liabilities Fund appointed by the
Secretary of State against personal liability in
the event of legal action against the Fund.
• Indemnities have been provided to trustees of
the Nuclear Liabilities Fund appointed by
British Energy (now EDF Energy) against
personal liability in the event of legal action
against the Fund, to be triggered only in the
event of failed recourse to indemnities from
EDF Energy.

106
Annual report and accounts 2019-20
• Indemnities have been provided to the Official
Receiver relating to their actions as
administrator of SSI Redcar with respect to
administration of the site.
• An indemnity has been provided to the Official
Receiver as liquidator of British Steel Limited
for actions undertaken as Receiver in respect
of any claims and proceedings that are made
against the Receiver personally.
• Indemnities have been provided to the Oil and
Gas Authority in respect of certain liabilities
that could arise from the actions or omissions
of its directors and otherwise arising from a
director holding or having held office in the
company
• Indemnities have been provided to the MCS
Service Company Limited and trustees of the
MCS Charitable Foundation for any liability that
might arise as a result of actions taken and
decisions made for which the Core
Department was ultimately responsible prior to
transfer to the Company and Charitable
Foundation of responsibility for the
Microgeneration Certification Scheme (MCS) in
April 2018.
Insurance claims
• A statutory liability will arise under the Nuclear
Installations Act 1965 for third-party claims in
excess of the operator’s liability in the event of
a nuclear accident in the UK.
• A contingent liability exists in relation to
Incidents/Accidents Insurance claims for
exposure to ionising radiation pursued outside
the existing UK Atomic Energy Authority
insurance scheme.
• The Core Department has indemnified Elexon
Limited against third party claims relating to
the design and/or implementation of the
Contracts for Difference and Capacity Markets
settlement systems which are not covered by
insurance and/or guarantees by their
sub‑contractors.
Losses or damages under agreements
• An indemnity has been provided for any losses
or damages caused to other parties to the
Energy Research Partnership consortium
agreement.
Environmental clean-up
• A contingent liability exists in relation to the
costs of retrieving and disposing of sealed
radioactive sources under the Environmental
Permitting (England and Wales) Regulations
2016 in the event that a company keeping
such sources becomes insolvent.
• A contingent liability arises in relation to the
remediation of land contaminated by a nuclear
occurrence as the Secretary of State is
deemed to be the appropriate person to bear
responsibility under section 9 of The
Radioactive Contaminated Land (Modification
of Enactments) (England) (Amendment)
Regulations 2007 SI 2007/3245.
• Under the United Nations Convention on the
Law of the Sea (UNCLOS) 1982, OSPAR
decision 98/3, the Energy Act 2004 and the
Petroleum Act 1998, the department would
become responsible for decommissioning
most oil, gas and renewable energy
installations in the event that operators are
unable to fulfil their decommissioning
commitments.
Others
• A liability could arise through non-compliance
with the Cogeneration Directive (2004/8/EC) in
the event of incorrect certification of combined
heat and power plants by contractors of the
Department.
• A contingent liability exists in respect of the
risks associated with the Core Department
assuming responsibility for uplifts in pension
contributions for the UK Atomic Energy
Authority’s non-active pension scheme
members.
• The Secretary of State Investor Agreement
(SOSIA) provides protections in certain
scenarios where the Hinkley Point C nuclear
plant is shut down for reasons that are political
or due to certain changes in insurance
arrangements or certain changes in law.
Payments under the SOSIA would be

107
Accountability report
expected in the first instance to be made using
funds from the Supplier Obligation but in
certain circumstances they could also come
direct from the Secretary of State, relying on
spending powers granted under the relevant
Appropriation Act or, if payments were to be
made over a period longer than two years,
seeking a new spending power at the time.
The payments could be up to around £22
billion excluding non-decommissioning
operational costs that may be incurred after
any shutdown. However, the liability to make
payments under the SOSIA is almost entirely
within the control of HM Government.
Unquantifiable remote contingent liabilities:
Agencies and departmental ALBs in
Departmental Group
• UKSA has an unquantifiable contingent liability
arising from the international (UN) convention,
which requires the UK Government to be
ultimately liable for third party costs from
accidental damage arising from UK space
activities. To manage the risk to the
Government, the Outer Space Act 1986
requires licensees to indemnify HMG against
any proven third party costs. In March 2015
the Outer Space Act 1986 was amended to
cap the previously unlimited liability for
licensed activities. The cap is set at €60 million
for the majority of missions. This amendment
came into force from 1 October 2015 and was
designed to adequately balance the risk to the
UK Government whilst ensuring UK space
operators remain competitive internationally.
There is a requirement on licensees to obtain
third party liability insurance (set at €60 million
for the majority of missions) for the duration of
the licensed activity, with the UK Government
a named beneficiary. The UK government is
therefore exposed to a potential liability for
third party costs which are not recoverable
from the licensee. The liability is unidentifiable
at the time of reporting.
• UKRI collaborates with a number of other
international partners in the funding,
management and operation of technical
facilities which are not owned by UKRI. In the
event of a decision to withdraw from any of
these arrangements, it is likely that UKRI
would assist in the search for a replacement
partner to ensure that technical commitments
were met. The most significant international
collaborations are in respect of CERN and
ESO. For both of these facilities there is the
possibility that UKRI would be obliged to
contribute to decommissioning costs arising
from a decision taken to discontinue
operations. The decisions to decommission
are not wholly within UKRI’s control.
• The NDA has non-quantifiable contingent
liabilities arising from indemnities given as part
of the contracts for the management of the
nuclear site license companies. These
indemnities are in respect of the uninsurable
residual risk that courts in a country which is
not party to the Paris and Brussels
Conventions on third party liability in the field
of nuclear energy may accept jurisdiction to
determine liability in the event of a nuclear
incident. Indemnities are in place in respect of
LLWR and Dounreay as set out in the relevant
Parent Body Agreements. In addition,
indemnities are provided to the previous
Parent Body Organisations (PBOs) of Magnox
and Sellafield covering the periods of their
ownership.

108
Annual report and accounts 2019-20
Other potential or expected
liabilities
The Department has entered into the following
arrangements, details of which are provided in
the interests of transparency. Neither of them is a
contingent liability requiring disclosure under IAS
37, the Government Financial Reporting Manual
or Managing Public Money as the obligating
events did not exist at the reporting date.
Hinkley Point C Funded Decommissioning
Programme (FDP) and Waste Transfer
Contracts (WTCs)
The contract with NNB Generation Company
Limited (NNB) to build Hinkley Point C (HPC)
nuclear power plant includes a Contract for
Difference between NNB and the Low Carbon
Contracts Company Ltd, an FDP and associated
FDP documents including WTCs between NNB
and the Core Department.
The FDP and related documents including WTCs
require NNB to make prudent provision for their
waste and decommissioning liabilities. To meet
their liabilities, the operator must set up a fund
with an independent governance framework and
will pay into it so that it is on track to fund the
liabilities that arise from decommissioning and
waste management. The fund will report annually
to the Secretary of State and a full review will be
conducted every five years to ensure that the
fund is on track to meet all its liabilities. If it is off
track, the operator will be required to take
corrective action. These liabilities are strictly the
operator’s responsibility and the probability of
taxpayers picking up these liabilities is remote.
Alongside the FDP, the government has entered
into two WTCs. These set out terms on which
the government will take title to and liability for
the spent fuel and intermediate level waste (ILW)
from the site after decommissioning in order to
dispose of the waste safely. The WTCs have
generally been prepared in line with the
government’s published waste transfer pricing
methodology.2 Although the WTCs provide a
default price based on today’s best estimate,
they allow the waste transfer price to be set after
a specified later date. The final price agreed is
2
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/42629/3798-waste-transfer-pricing-methodology.pdf
subject to a cap, but the likelihood of the future
costs exceeding the agreed cap is considered
remote.
Capacity agreements
These are statutory arrangements between
National Grid, as system operator, and capacity
providers. They require the capacity provider to
be able to provide a given level of capacity in
relevant delivery years when called upon to do
so by National Grid.
The European Court of Justice (ECJ) ruling on
15 November 2018 resulted in a ‘Standstill
Period’ for the Capacity Market during which no
State Aid (in the form of capacity payments) was
paid to capacity providers in relation to the
annulled Main Scheme Approval. The European
Commission (EC) appealed the ECJ’s decision
and on 24 October 2019, the Department was
informed by the EC that it had completed its
State Aid investigation into the Capacity Market
and that the Capacity Market scheme complies
with EU State Aid rules. On 25 October 2019,
the Department notified ESC and National Grid
to restart their respective Capacity Market
activities.
At a capacity auction, applicants who offer
the lowest bid can win a capacity agreement.
A capacity auction relates to delivery of capacity
approximately 4 years ahead (T-4). Most recently,
the capacity agreements resulting from the 2019
T-3 and T-4 capacity auction held in February
and March 2020, are for the Delivery Year
commencing in 2022/23 and 2023/24. Also, the
capacity agreements resulting from the 2019 T-1
capacity auction, held in January 2020, are for
the delivery year commencing in 2020/21.
In addition to T-1, T-3 and T-4, the interim
periods are covered by Transitional
arrangements. There are currently 8 live capacity
auctions out of a total of 13, which have been
awarded from the start of the scheme in 2014 for
the delivery year commencing 2016/17.

109
Accountability report
The Department has responsibility for
administering the settlement process. This role is
undertaken by the Electricity Settlements
Company (ESC). The obligation for ESC to make
capacity payments only arises when the
respective levy is received from licensed
suppliers and the generator provides the agreed
level of capacity. The potential income and
payments arising from these arrangements are
outlined in the following table:
As at 31 March 2020
As at 31 March 2019
Due within
1 year
Due within
2-5 years
Due over
5 years
Total
Total
£m
£m
£m
£m
£m
Capacity Market – ESC
1,236
2,699
1,761
5,696
–
Income from levy – ESC
(1,236)
(2,699)
(1,761)
(5,696)
–
Total Departmental Group
–
–
–
–
–
Regularity of Expenditure
Audited information
The Department ensures that the concept of
regularity is understood and complied with in all its
operational activities. It ensures compliance with
HM Treasury’s Managing Public Money. The
Comptroller & Auditor General has qualified his
regularity opinion on these accounts (see
page 110). This is due to an Excess Vote in the
Department’s Resource Annually Managed
Expenditure (AME) budget as a result of the
COVID-19 emergency interventions by the
Government, namely the Small Business Grant
Fund and the Retail, Hospitality and Leisure Grant
Fund. Due to the timing of the COVID-19
response in March 2020, this expenditure was
incurred without the necessary parliamentary
approval by way of a Supplementary Estimate.
Further information in relation to these schemes
can be seen on note 18 and note 28 of the
accounts. This has led to a total Excess of
Resource AME of £4.9 billion. The Department will
seek parliamentary approval by way of an Excess
Vote in the next Supply and Appropriation Act.
Sarah Munby
Permanent Secretary and
Principal Accounting Officer
11 September 2020

110
Annual report and accounts 2019-20
The Certificate of the Comptroller
and Auditor General to the
House of Commons
Opinion on financial statements
I certify that I have audited the financial
statements of the Department for Business,
Energy and Industrial Strategy (“the Department”)
and of its Departmental Group for the year ended
31 March 2020 under the Government
Resources and Accounts Act 2000. The
Department comprises the Core Department and
its Agencies. The Departmental Group consists
of the Department and the bodies designated for
inclusion under the Government Resources and
Accounts Act 2000 (Estimates and Accounts)
Order 2019. The financial statements comprise:
the Department’s and Departmental Group’s
Statements of Comprehensive Net Expenditure,
Financial Position, Cash Flows, Changes in
Taxpayers’ Equity; and the related notes,
including the significant accounting policies.
These financial statements have been prepared
under the accounting policies set out within
them.
I have also audited the Statement of
Parliamentary Supply and the related notes, and
the information in the Accountability Report that
is described in that report as having been
audited.
In my opinion:
• the financial statements give a true and fair
view of the state of the Department’s and the
Departmental Group’s affairs as at 31 March
2020 and of the Department’s net expenditure
and Departmental Group’s net expenditure for
the year then ended; and
• the financial statements have been properly
prepared in accordance with the Government
Resources and Accounts Act 2000 and HM
Treasury directions issued thereunder.
Emphasis of matter – Provision for nuclear
decommissioning and Contracts for
Difference (CfDs) derivative.
Without qualifying my opinion, I draw attention to
the disclosures made in notes 1.26 and 18.1 to
the financial statements concerning the
uncertainties inherent in the nuclear
decommissioning provisions. As set out in these
notes, given the very long timescales involved
and the complexity of the plants and materials
being handled, a considerable degree of
uncertainty remains over the value of the liability
for decommissioning nuclear sites designated by
the Secretary of State. Significant changes to the
liability could occur as a result of subsequent
information and events which are different from
the current assumptions adopted.
Finally, I also draw attention to the disclosures
made in notes 1.26 and 9 to the financial
statements concerning the measurement of
liabilities relating to CFDs. As set out in these
notes, there is a high degree of estimation
uncertainty inherent in forecasting electricity
generation volumes and wholesale electricity
prices into the late 2030s (and 2060s for the
purposes of the Hinkley Point C CFD) and there
is a great deal of subjectivity involved in selecting
a wholesale electricity price forecast input that
conforms to the principles of fair value.
Significant changes to the liability could occur as
a result of subsequent information and events
which are different from the current assumptions
adopted.

111
Accountability report
Qualified Opinion on regularity
In my opinion, except for the excess described in
the basis for qualified opinion paragraph, in all
material respects:
• the Statement of Parliamentary Supply
properly presents the outturn against voted
Parliamentary control totals for the year ended
31 March 2020 and shows that those totals
have not been exceeded; and
• the income and expenditure recorded in the
financial statements have been applied to the
purposes intended by Parliament and the
financial transactions recorded in the financial
statements conform to the authorities which
govern them.
Basis for Qualified opinion on regularity
Parliament authorised a Resource Annually
Managed Expenditure limit for the Departmental
Group of £14,588 million. Against this limit, the
Departmental Group incurred actual outturn of
£19,483 million, breaching the authorised limit by
£4,895 million, due to the recognition of a
provision, as shown in the Statement of
Parliamentary Supply.
Basis of opinions
I conducted my audit in accordance with
International Standards on Auditing (ISAs) (UK)
and Practice Note 10 ‘Audit of Financial
Statements of Public Sector Entities in the United
Kingdom’. My responsibilities under those
standards are further described in the Auditor’s
responsibilities for the audit of the financial
statements section of my certificate. Those
standards require me and my staff to comply
with the Financial Reporting Council’s Revised
Ethical Standard 2016. I am independent of the
Department in accordance with the ethical
requirements that are relevant to my audit and
the financial statements in the UK. My staff and I
have fulfilled our other ethical responsibilities in
accordance with these requirements. I believe
that the audit evidence I have obtained is
sufficient and appropriate to provide a basis for
my opinion.
Conclusions relating to going concern
I have nothing to report in respect of the
following matters in relation to which the ISAs
(UK) require me to report to you where:
• the Department’s use of the going concern
basis of accounting in the preparation of the
financial statements is not appropriate; or
• the Department have not disclosed in the
financial statements any identified material
uncertainties that may cast significant doubt
about the Department’s ability to continue to
adopt the going concern basis of accounting
for a period of at least twelve months from the
date when the financial statements are
authorised for issue.
Responsibilities of the Accounting Officer
for the financial statements
As explained more fully in the Statement of
Accounting Officer’s Responsibilities, the
Accounting Officer is responsible for the
preparation of the financial statements and for
being satisfied that they give a true and fair view.
Auditor’s responsibilities for the audit of the
financial statements
My responsibility is to audit, certify and report on
the financial statements in accordance with the
Government Resources and Accounts Act 2000.
An audit involves obtaining evidence about the
amounts and disclosures in the financial
statements sufficient to give reasonable
assurance that the financial statements are free
from material misstatement, whether caused by
fraud or error. Reasonable assurance is a high
level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs (UK)
will always detect a material misstatement when
it exists. Misstatements can arise from fraud or
error and are considered material if, individually
or in the aggregate, they could reasonably be
expected to influence the economic decisions of
users taken on the basis of these financial
statements.

112
Annual report and accounts 2019-20
As part of an audit in accordance with ISAs (UK),
I exercise professional judgment and maintain
professional scepticism throughout the audit. I
also:
• identify and assess the risks of material
misstatement of the financial statements,
whether due to fraud or error, design and
perform audit procedures responsive to those
risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis
for my opinion. The risk of not detecting a
material misstatement resulting from fraud is
higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override
of internal control.
• obtain an understanding of internal control
relevant to the audit in order to design audit
procedures that are appropriate in the
circumstances, but not for the purpose of
expressing an opinion on the effectiveness of
the Group’s and the Department’s internal
control.
• evaluate the appropriateness of accounting
policies used and the reasonableness of
accounting estimates and related disclosures
made by management.
• evaluate the overall presentation, structure and
content of the financial statements, including
the disclosures, and whether the consolidated
financial statements represent the underlying
transactions and events in a manner that
achieves fair presentation.
• obtain sufficient appropriate audit evidence
regarding the financial information of the
entities or business activities within the Group
to express an opinion on the group financial
statements. I am responsible for the direction,
supervision and performance of the group
audit. I remain solely responsible for my audit
opinion.
• Conclude on the appropriateness of the
Department’s use of the going concern basis
of accounting and, based on the audit
evidence obtained, whether a material
uncertainty exists related to events or
conditions that may cast significant doubt on
the group’s ability to continue as a going
concern. If I conclude that a material
uncertainty exists, I am required to draw
attention in my report to the related
disclosures in the financial statements or, if
such disclosures are inadequate, to modify my
opinion. My conclusions are based on the
audit evidence obtained up to the date of my
report. However, future events or conditions
may cause the group to cease to continue as
a going concern.
I communicate with those charged with
governance regarding, among other matters, the
planned scope and timing of the audit and
significant audit findings, including any significant
deficiencies in internal control that I identify
during my audit.
I am required to obtain evidence sufficient to give
reasonable assurance that the Statement of
Parliamentary Supply properly presents the
outturn against voted Parliamentary control totals
and that those totals have not been exceeded.
The voted Parliamentary control totals are
Departmental Expenditure Limits (Resource and
Capital), Annually Managed Expenditure
(Resource and Capital), Non-Budget (Resource)
and Net Cash Requirement. I am also required to
obtain evidence sufficient to give reasonable
assurance that the expenditure and income
recorded in the financial statements have been
applied to the purposes intended by Parliament
and the financial transactions recorded in the
financial statements conform to the authorities
which govern them.
Other Information
The Accounting Officer is responsible for the
other information. The other information
comprises information included in the annual
report, but does not include the parts of the
Accountability Report described in that report as
having been audited, the financial statements
and my auditor’s report thereon. My opinion on
the financial statements does not cover the other
information and I do not express any form of
assurance conclusion thereon. In connection
with my audit of the financial statements, my
responsibility is to read the other information and,
in doing so, consider whether the other

113
Accountability report
information is materially inconsistent with the
financial statements or my knowledge obtained
in the audit or otherwise appears to be materially
misstated. If, based on the work I have
performed, I conclude that there is a material
misstatement of this other information, I am
required to report that fact. I have nothing to
report in this regard.
Opinion on other matters
In my opinion:
• the parts of the Accountability Report to be
audited have been properly prepared in
accordance with HM Treasury directions made
under the Government Resources and
Accounts Act 2000;
• in the light of the knowledge and
understanding of the group and the parent
and its environment obtained in the course of
the audit, I have not identified any material
misstatements in the Performance Report or
the Accountability Report; and
• the information given in the Performance and
Accountability Reports for the financial year for
which the financial statements are prepared is
consistent with the financial statements.
Matters on which I report by exception
I have nothing to report in respect of the
following matters which I report to you if, in my
opinion:
• adequate accounting records have not been
kept or returns adequate for my audit have not
been received from branches not visited by my
staff; or
• the financial statements and the parts of the
Accountability Report to be audited are not in
agreement with the accounting records and
returns; or
• I have not received all of the information and
explanations I require for my audit; or
• the Governance Statement does not reflect
compliance with HM Treasury’s guidance
Report
My report on the qualification in respect of the
excess vote is at page 114.
Gareth Davies
Comptroller and Auditor General
15 September 2020
National Audit Office
157-197 Buckingham Palace Road
Victoria
London
SW1W 9SP

114
Annual report and accounts 2019-20
The Report of the Comptroller and Auditor
General to the House of Commons
Introduction
The Department for Business, Energy and
Industrial Strategy (“the Department”) is the
government department responsible for building
an economy which is fairer, cleaner, more
innovative, and attracts investment from all over
the world. Its priorities include promoting
competitive markets and ensuring that the UK
has a reliable, low cost and clean energy system.
The net expenditure of government departments
is authorised by the annual Supply and
Appropriation Acts of Parliament and their
associated Supply Estimates. These Acts set a
series of expenditure limits on each department’s
spending, and net cash requirement. Expenditure
beyond any of these limits is considered a
breach of a control total and results in an ‘Excess
Vote’. Such expenditure potentially undermines
parliamentary control over public spending.
Where these limits are breached, I qualify my
regularity opinion on the financial statements.
Parliament authorised a Resource Annually
Managed Expenditure (RAME) limit of £14,588
million for the Department in 2019-20. This limit
means that the Department was required to incur
RAME expenditure of less than £14,588 million.
However, the outturn against the RAME limit was
£19,483 million, and the authorised limit was
therefore breached by £4,895 million. I have
therefore qualified my regularity opinion on the
Department’s financial statements in this respect.
Grants to businesses (in relation to
COVID-19)
The government announced in March 2020 that
qualifying businesses could expect to receive
support in the form of grants to help counteract
the adverse financial effects bought about by the
coronavirus pandemic. Businesses eligible for
either Small Business Rate Relief or Rural Rate
Relief received a grant of £10,000. Businesses in
the retail, hospitality and leisure sectors sectors
with a rateable value below £15,000, who are
not eligible for Small Business Rates Relief,
received a grant of £10,000 each, and those with
a rateable value between £15,000 and £51,000
received a grant of £25,000 each. The
Department has the responsibility of managing
the schemes and payments are being
administered to businesses by local authorities.
The announcements and actions taken prior to
31 March 2020 to ensure that cash was paid
out to businesses as soon as possible created
a constructive obligation under IAS 37. As a
result, the Department has recognised a
provision of £10,824 million representing the
Department’s estimate of total payments to be
made under the schemes.
Government departments prepare and agree two
Supply Estimates during the year, the Main
Estimate in or around May each year and the
Supplementary Estimate before the year-end in
or around February each year. At the time of
submitting the Supplementary Estimate, the
Department could not anticipate the impact of
the COVID-19 pandemic or the urgent action
that it would require to support the economy.
However, as the Department could not allow for
these grant schemes in its Supplementary
Estimate, the recognition of the £10,824 million
provision meant that the Department exceeded
their control total, as detailed on page 109 of the
Annual Report. This breach requires an Excess
Vote from HM Treasury and leads to a regularity
qualification in the audit opinion.
Gareth Davies
Comptroller and Auditor General
15 September 2020
National Audit Office
157-197 Buckingham Palace Road
Victoria
London
SW1W 9SP

Financial
Statements

116
Annual report and accounts 2019-20
Consolidated Statement of
Comprehensive Net Expenditure
for the period ended 31 March 2020
31 March 2020
31 March 2019 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Note
£m
£m
£m
£m
Income from sale of goods and services
6.1
(257)
(4,798)
(749)
(3,260)
Total operating income
(257)
(4,798)
(749)
(3,260)
Staff costs
3
390
1,240
330
1,119
Purchase of goods and services
4.1
1,597
4,301
1,424
2,942
Depreciation and impairment charges
4.2
18
440
48
600
Provision expense
4.3
10,869
17,873
59
(97,721)
Grants
4.4
14,006
9,410
12,907
8,280
Other operating expenditure
33
27
3
(5)
Total operating expenditure
26,913
33,291
14,771
(84,785)
Net operating expenditure
26,656
28,493
14,022
(88,045)
Finance income
6.2
(212)
(334)
(214)
(370)
Finance expense
5
(125)
(18)
(249)
(3,775)
Contracts for difference derivatives
9
–
5,346
–
(1,991)
Share of post-tax loss/(profits) of associates
and joint ventures
13
–
5
–
(186)
Net expenditure for the year from
operations
26,319
33,492
13,559
(94,367)
Net expenditure for the year
26,319
33,492
13,559
(94,367)
Other Comprehensive Income and
Expenditure
Net (gain)/loss on:
Items that will not be reclassified to net
operating expenditure:
– revaluation of property, plant and
equipment
–
(57)
–
(145)
– revaluation of intangible assets
–
(13)
–
(19)
Items that may be reclassified subsequently to
net operating costs:
– revaluation of investments
166
116
(35)
(63)
– other revaluation movements
12
(2)
56
2
– actuarial (gains)/losses
–
(88)
–
69
– joint venture and associate other
movements
–
–
–
(35)
Total other comprehensive net income
and expenditure
178
(44)
21
(191)
Comprehensive net expenditure for
the year
26,497
33,448
13,580
(94,558)
All operations are continuing.
Further analysis of staff costs can be found in the Staff note in the Accountability Report on page 69.
The notes on pages 123 to 223 form part of these Accounts.

117
Financial Statements
Consolidated Statement of
Financial Position
as at 31 March 2020
31 March 2020
31 March 2019 restated
1 April 2018
Core
Department
and
Agencies
Departmental
Group
Core
Department
and
Agencies
Departmental
Group
Core
Department
and
Agencies
Departmental
Group
Note
£m
£m
£m
£m
£m
£m
Non-current assets:
Property, plant and
equipment
7
306
3,605
294
3,533
276
3,414
Investment properties
2
121
–
117
23
145
Intangible assets
8
101
230
14
167
9
145
Investment and loans
in public bodies
10
3,392
1,706
3,348
1,758
2,996
1,630
Other financial assets
11
967
4,120
1,196
4,118
1,028
4,194
Recoverable contract
costs
12
–
1,425
–
1,620
–
3,346
Derivative financial
instruments
22
–
–
7
7
47
78
Investment in joint
ventures and
associates
13
–
967
–
1,039
–
367
Trade and other
receivables
14
740
848
813
938
932
1,090
Total non-current
assets
5,508
13,022
5,672
13,297
5,311
14,409
Current assets:
Inventories
–
51
–
37
–
31
Non-current assets
held for sale
–
6
–
20
–
15
Trade and other
receivables
14
538
2,258
447
1,565
544
1,343
Investments and loans
in public bodies
15
687
672
666
620
732
732
Other financial assets
11
–
–
–
–
142
142
Derivative financial
instruments
22
9
9
17
17
31
31
Cash and cash
equivalents
16
1,039
2,158
1,283
2,078
1,246
2,034
Total current assets
2,273
5,154
2,413
4,337
2,695
4,328
Total assets
7,781
18,176
8,085
17,634
8,006
18,737
Current liabilities:
Trade payables and
other liabilities
17
(2,782)
(6,484)
(2,908)
(5,652)
(2,283)
(4,954)
Provisions for liabilities
and charges
18
(11,047)
(14,065)
(260)
(3,050)
(278)
(3,332)
Financial guarantees
and loan commitment
liabilities
19
(17)
(17)
(11)
(11)
(16)
(16)
Derivative financial
instruments
22
–
–
(1)
(13)
–
(11)

118
Annual report and accounts 2019-20
31 March 2020
31 March 2019 restated
1 April 2018
Core
Department
and
Agencies
Departmental
Group
Core
Department
and
Agencies
Departmental
Group
Core
Department
and
Agencies
Departmental
Group
Note
£m
£m
£m
£m
£m
£m
Total current
liabilities
(13,846)
(20,566)
(3,180)
(8,726)
(2,577)
(8,313)
Non-current assets
plus/less net current
assets/ liabilities
(6,065)
(2,390)
4,905
8,908
5,429
10,424
Non-current
liabilities:
Trade payables and
other liabilities
17
(883)
(2,467)
(1,141)
(2,901)
(1,203)
(2,901)
Provisions for liabilities
and charges
18
(1,702)
(136,034)
(1,920)
(131,416)
(2,176)
(237,603)
Financial guarantees
and loan commitment
liabilities
19
(74)
(221)
(43)
(219)
(45)
(45)
Derivative financial
instruments
9, 22
–
(16,464)
(2)
(12,923)
–
(15,904)
Retirement benefit
obligations
20
–
(87)
–
(921)
–
(686)
Total non-current
liabilities
(2,659)
(155,273)
(3,106)
(148,380)
(3,424)
(257,139)
Total assets less
liabilities
(8,724)
(157,663)
1,799
(139,472)
2,005
(246,715)
Taxpayers’ equity
and other reserves:
General fund
(9,266)
(160,292)
1,077
(142,297)
995
(250,098)
Revaluation reserve
542
1,998
722
2,155
1,010
2,915
Charitable funds
–
402
–
438
–
314
Non-controlling
interests
–
229
–
232
–
154
Total equity
(8,724)
(157,663)
1,799
(139,472)
2,005
(246,715)
Core Department and Agencies comprise the Core Department and the UK Space Agency and
Insolvency Service.
The notes on pages 123 to 223 form part of these Accounts.
Sarah Munby
Permanent Secretary and Principal Accounting Officer
11 September 2020

119
Financial Statements
Consolidated Statement of Cash Flows
for the period ended 31 March 2020
2019-20
2018-19 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Note
£m
£m
£m
£m
Cash flows from operating activities
Net operating cost
(26,319)
(33,492)
(13,559)
94,367
Adjustment for non-cash expenditure
10,735
23,584
(151)
(103,003)
(Increase)/decrease in inventories
–
(14)
–
(6)
(Increase)/decrease in trade and other
receivables
14
(18)
(603)
216
(70)
Less movements in receivables relating to
items not passing through the Consolidated
Statement of Comprehensive Net Expenditure
101
227
(71)
(71)
Increase/(decrease) in trade payables and
other liabilities
17
(384)
398
563
692
Less movements in payables relating to items
not passing through the Consolidated
Statement of Comprehensive Net Expenditure
73
(470)
(730)
(1,531)
Use of provisions
18
(249)
(3,039)
(284)
(3,078)
Financial guarantees called in
19
(13)
(13)
(11)
(11)
Expenditure funded by the National Insurance
Fund (RPS)
4.1
430
430
320
320
Payments to retirement benefit obligations
(106)
–
(144)
Net cash outflow from operating activities
(15,644)
(13,098)
(13,707)
(12,535)
Cash flows from investing activities
Purchase of property, plant and equipment
(38)
(295)
(46)
(312)
Purchase of intangible assets
(123)
(150)
(8)
(36)
Proceeds of disposal of property, plant
and equipment
–
31
–
3
Proceeds of disposal of investment property
–
–
20
20
Proceeds of disposal of intangible assets
–
2
–
–
Proceeds of disposal of assets held for sale
–
5
–
–
Loan redeemed from Post Office Limited
15
5,342
5,342
6,360
6,360
Loans made to Post Office Limited
15
(5,379)
(5,379)
(6,240)
(6,240)
Repayments of loans and investments
32
745
33
754
Payments to the Contracts for Difference
generators
9
–
(1,803)
–
(980)
Other investments and loans made
(242)
(1,091)
(330)
(1,004)
Repayments of Public Dividend Capital
16
–
–
–
Launch investment receipts
340
340
230
230
Venture capital fund redemptions
7
106
7
121
Venture capital fund investments
–
(255)
–
(235)
Dividends from Joint ventures and associates
13
–
94
–
87
Disposal of Joint venture and associates
–
2
–
–
Investment in Joint ventures and associates
13
–
(30)
–
(37)
Investment in shares
(19)
(19)
(125)
–
Net cash outflow from investing activities
(64)
(2,355)
(99)
(1,269)

120
Annual report and accounts 2019-20
2019-20
2018-19 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Note
£m
£m
£m
£m
Cash flows from financing activities
From Consolidated Fund (supply) –
current year
15,465
15,465
14,139
14,139
Advances from the Contingencies Fund
–
–
5
5
Repayments to the Contingencies Fund
–
–
(7)
(7)
From the National Insurance Fund
430
436
320
320
Payments in respect of the National Insurance
Fund
4.1
(430)
(436)
(320)
(320)
Other adjustments relating to financing
activities
–
3
–
–
Disposal of shares
–
–
–
3
Net financing
15,465
15,468
14,137
14,140
Net increase/(decrease) in cash and cash
equivalents in the period before
adjustment for receipts and payments to
the Consolidated Fund
(243)
15
331
336
Receipts due to the Consolidated Fund which
are outside the scope of the Department’s
activities
841
907
1,463
1,465
Payments of amounts due to the
Consolidated Fund
(842)
(842)
(1,757)
(1,757)
Net increase/(decrease) in cash and cash
equivalents in the period after adjustment
for receipts and payments to the
Consolidated Fund
(244)
80
37
44
Cash and cash equivalents opening
balance
1,283
2,078
1,246
2,034
Cash and cash equivalents at the end of
the period
16
1,039
2,158
1,283
2,078

121
Financial Statements
Statement of Changes in Taxpayers’
Equity (Core Department and Agencies)
for the period ended 31 March 2020

Note
General
Fund
Revaluation
Reserve
Taxpayers’
equity
Total
Reserves
£m
£m
£m
£m
Balance at 1 April 2018
995
1,010
2,005
2,005
IFRS 9 opening balance adjustments
277
(263)
14
14
Revised balance at 1 April 2018
1,272
747
2,019
2,019
Net parliamentary funding – drawn down
14,139
–
14,139
14,139
Net parliamentary funding – deemed
928
–
928
928
National Insurance Fund – RPS
4.1
320
–
320
320
Supply (payable)/receivable adjustment
17
(1,280)
–
(1,280)
(1,280)
Income payable to the Consolidated Fund
(675)
–
(675)
(675)
Decrease in RPS receivables
14
(71)
–
(71)
(71)
Net expenditure for the year
(13,559)
–
(13,559)
(13,559)
Non-Cash Adjustments:
Auditors’ remuneration
4.1
1
–
1
1
Movements in Reserves:
Other comprehensive net expenditure for
the year
–
(21)
(21)
(21)
Transfers between reserves
1
(1)
–
–
Other movements
1
(3)
(2)
(2)
Balance at 31 March 2019
1,077
722
1,799
1,799
Balance at 1 April 2019
1,077
722
1,799
1,799
Net parliamentary funding – drawn down
15,465
–
15,465
15,465
Net parliamentary funding – deemed
1,280
–
1,280
1,280
National Insurance Fund – RPS
436
–
436
436
Supply (payable)/receivable adjustment
17
(1,036)
–
(1,036)
(1,036)
Income payable to the Consolidated Fund
(169)
–
(169)
(169)
Net expenditure for the year
(26,319)
–
(26,319)
(26,319)
Non-Cash Adjustments:
Auditors’ remuneration
4.1
1
–
1
1
Movements in Reserves:
Other comprehensive net income for the year
–
(178)
(178)
(178)
Transfers between reserves
2
(2)
–
–
Other movements
(3)
–
(3)
(3)
Balance at 31 March 2020
(9,266)
542
(8,724)
(8,724)

122
Annual report and accounts 2019-20
Consolidated Statement of Changes in
Taxpayers’ Equity (Departmental Group)
for the period ended 31 March 2020

Note
General
Fund
restated
Revaluation
Reserve
Taxpayers’
Equity
restated
Charitable
Funds –
Unrestr-
icted/
Restricted
Non
controlling
interest
Total
Reserves
restated
£m
£m
£m
£m
£m
£m
Balance at 31 March 2018
(250,098)
2,915
(247,183)
314
154
(246,715)
IFRS 9 opening balance adjustment
941
(926)
15
–
–
15
Balance at 1 April 2018
(249,157)
1,989
(247,168)
314
154
(246,700)
Net parliamentary funding – drawn down
14,139
–
14,139
–
–
14,139
Net parliamentary funding – deemed
928
–
928
–
–
928
National Insurance Fund – RPS
4.1
320
–
320
–
–
320
Supply (payable)/receivable adjustment 14, 17
(1,280)
–
(1,280)
–
–
(1,280)
Income payable to the Consolidated
Fund
(1,331)
–
(1,331)
–
–
(1,331)
Decrease in RPS receivables
14
(71)
–
(71)
–
–
(71)
Net expenditure for the year
94,367
–
94,367
–
–
94,367
Amounts paid from distributable reserves
(131)
–
(131)
–
–
(131)
Non-Cash Adjustments:
Auditors’ remuneration
4.1
1
–
1
–
–
1
Movements in Reserves:
Other Comprehensive net
(expenditure)/ income for the year
(34)
225
191
–
–
191
Transfers between reserves
(55)
(60)
(115)
124
(9)
–
Minority interest
–
–
–
–
87
87
Other movements
7
1
8
–
–
8
Balance at 31 March 2019
(142,297)
2,155
(140,142)
438
232
(139,472)
Balance at 1 April 2019
(142,297)
2,155
(140,142)
438
232
(139,472)
Net parliamentary funding – drawn
down
15,465
–
15,465
–
–
15,465
Net parliamentary funding – deemed
1,280
–
1,280
–
–
1,280
National Insurance Fund – RPS
436
–
436
–
–
436
Supply (payable)/receivable adjustment
17
(1,036)
–
(1,036)
–
–
(1,036)
Income payable to the Consolidated
Fund
(791)
–
(791)
–
–
(791)
Net expenditure for the year
(33,492)
–
(33,492)
–
–
(33,492)
Amounts paid from distributable
reserves
(108)
–
(108)
–
–
(108)
Non-Cash Adjustments:
Auditors’ remuneration
4.1
1
–
1
–
–
1
Movements in Reserves:
Other comprehensive net (expenditure)/
income for the year
88
(44)
44
–
–
44
Transfers between reserves
166
(112)
54
(36)
(18)
–
Minority interest
–
–
–
–
15
15
Other movements
(4)
(1)
(5)
–
–
(5)
Balance at 31 March 2020
(160,292)
1,998
(158,294)
402
229
(157,663)
The notes on pages123 to 223 form part of these accounts.

123
Financial Statements
Notes to the Accounts
1. Accounting policies, judgements and estimates
1.1 Basis of accounting
These financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRS) as adapted and interpreted by the HM Treasury 2019-20 Government Financial
Reporting Manual (FReM) and as set out in the Accounts Direction to the Department pursuant to
section 5(2) of the Government Resources and Accounts Act 2000 (GRAA) except as described at
1.2 below. Where the FReM permits a choice of accounting policy, the policy selected is that judged
to be most appropriate to the particular circumstances of the Department and its consolidated entities
(the Departmental Group) for the purpose of giving a true and fair view. The policies adopted by the
Departmental Group are described below; they have been applied consistently to items considered
material to the accounts.
The Consolidated Statement of Financial Position (SoFP) shows significant net liabilities, primarily
relating to Contracts for Difference derivatives and provisions for nuclear decommissioning which will
be settled over many years. Liabilities in excess of those to be funded by the Departmental Group will
be met by future funding voted by Parliament annually in Supply and Appropriation Acts. There is no
reason to believe the resources to settle these liabilities will not be forthcoming. It has accordingly
been considered appropriate to adopt a going concern basis for the preparation of these financial
statements.
1.2 Accounting convention
These accounts have been prepared under the historical cost convention modified to measure
Property, plant and equipment (except specific waste management assets), Intangibles, Investment
properties and Financial instruments at fair value to the extent required or permitted under IFRS as set
out in these accounting policies.
The Department has agreed with HM Treasury that specific nuclear waste management assets should
be measured at historical cost less any impairment losses where there is no reliable and cost effective
valuation methodology; this is a departure from the FReM requirement to report Property, plant and
equipment at fair value. Public Dividend Capital and shares in consolidated bodies held by the Core
Department are carried at historical cost less any impairment in accordance with the FReM.
1.3 Presentational currency
The financial statements are presented in pounds sterling, the functional currency of the Departmental
Group. Transactions denominated in a foreign currency are translated into sterling at the rate of
exchange on the date of each transaction. In preparing the financial statements, monetary assets and
liabilities denominated in foreign currencies are translated at the rates prevailing at the reporting date.
All translation differences of monetary assets and liabilities are included in Net expenditure for the year.
Values are rounded to the nearest million pounds (£m) unless the FReM requires a lower threshold.
1.4 Basis of consolidation
The Departmental Group accounts consolidate the balances of the Core Department and designated
bodies listed in note 27, which fall within the departmental boundary as defined in the FReM and
make up the ‘Departmental Group’, excluding transactions and balances between them. Where the
Office for National Statistics (ONS) designates a body retrospectively such that the body should have
been designated for consolidation in a prior period, the accounts are voluntarily restated to reflect
the position from the effective date of classification. The consolidated bodies prepare accounts in
accordance with either the FReM, the Charities’ Statement of Recommended Practice (for charities),

124
Annual report and accounts 2019-20
or the Companies Act 2006 (for limited companies). For those bodies that do not prepare accounts in
accordance with the FReM, adjustments are made at consolidation if necessary where differences
would have a significant effect on the accounts. The Core Department and its designated bodies are
all domiciled in the UK.
1.5 Changes in accounting policies
Accounting policies are unchanged compared to those in the 2018-19 Departmental Group financial
statements.
1.6 New accounting standards adopted in the year and FReM changes
No new accounting standards have been adopted in these financial statements. The FReM 2019-20
has been updated to include details concerning the adaptations and interpretations related to IFRS 16
‘Leases’. Further details are provided in note 1.7 below.
1.7 Applicable accounting standards issued but not yet adopted
The revised Conceptual Framework for Financial Reporting
The International Accounting Standards Board (IASB) issued the revised Conceptual Framework for
Financial Reporting in March 2018. It replaces the Conceptual Framework issued in September 2010.
The revised Conceptual Framework is effective for annual reporting period beginning on or after
1 January 2020. It will be adopted by the FReM from 1 April 2020. The Conceptual Framework
sets out the fundamental concepts for financial reporting. It helps ensure that the Standards are
conceptually consistent and that similar transactions are treated in the same way.
One of the main updates in the revised Conceptual Framework was new guidance in recognising
liabilities and assets when there is significant uncertainty. This would have affected the Departmental
Group’s key judgement that the Contract for Difference (CfD) for Hinkley Point C (HPC) was unable
to be recognised in the Departmental Group’s Statement of Financial Position (SoFP) due to the
significant uncertainty of the HPC’s CfD valuation. Under the revised Conceptual Framework,
HPC’s CfD would be recognised. However, the expected impact of adopting the revised Conceptual
Framework will be negligible due to the CfD for HPC being recognised in these financial statements
(see note 1.26).
IFRS 16 ‘Leases’
IFRS 16 ‘Leases’ replaces IAS 17 ‘Leases’ and will now be adopted by the public sector in 2021-22.
The Financial Reporting Advisory Board (FRAB) agreed in March 2020 to a further year’s deferral from
2020-21 to 2021-22. The Departmental Group will adopt IFRS 16 from 1 April 2021. Entities in the
Departmental Group who report under IFRS and the Companies Act, have adopted IFRS 16 from 1
April 2019, in line with their Companies Act reporting requirements. These adjustments have been
reversed in the preparation of the Departmental Group accounts and the Departmental Group has
continued to apply IAS 17 for the 2019-20 financial year.
IFRS 16 represents a significant change in lessee accounting by removing the distinction between
operating leases (off-statement of financial position financing) and finance leases (on-statement of
financial position financing) and introducing a single lessee accounting model. IFRS 16 requires the
recognition of all leases as on-statement of financial position financing with exemption given to low
value leases and short-term leases, i.e. leases with a lease term of less than 12 months as mandated
by the FReM. This will result in the recognition of a right-to-use asset, measured at the present value
of future lease payments, and a matching liability in the SoFP. Upon transition, the FReM has
mandated the use of practical expedient in IFRS 16, which means the Department, only applies the
standard to contracts which were previously identified as leases under IAS 17 and IFRIC 4. In
addition, the FReM has also mandated that upon transition, the prior year comparatives will not be
restated and a cumulative catch up will be recognised in the Statement of Change in Taxpayers Equity
along with opening balance transition adjustments in the SoFP to recognise the right of use assets
and right of use liabilities.

125
Financial Statements
The overall impact of the new accounting standard on the Statement of Comprehensive Net
Expenditure (SoCNE) is expected to be immaterial, whilst there is expected to be material right-to-use
assets of circa £355 million and a corresponding right of use lease liabilities recognised in the SoFP, if
the standard was adopted on 1 April 2021. The expected impact is based on the value of operating
lease and finance lease commitments the Departmental Group has in place at 31 March 2020 that are
expected to be in place at 1 April 2021 per note 21 and 21.2.1. The overall impact on net assets of
the Departmental Group is expected to be immaterial.
IFRS 17 ‘Insurance Contracts’
IFRS 17 ‘Insurance Contracts’ replaces IFRS 4 ‘Insurance Contracts’, which requires reporters
to identify insurance contracts, and for those contracts recognise an insurance contract liability.
The insurance contract liability is calculated as the present value of future insurance cashflows
(the fulfilment cash flows) plus a subsequent risk adjustment. The IASB announced the deferral of
IFRS 17 by two years until 1 January 2023 and therefore, the implementation timetable in the public
sector is being extended to at least 1 April 2023. The Departmental Group is currently assessing the
impact of the IFRS 17 adoption.
1.8 Operating income
Operating income relates directly to the operating activities of the Departmental Group and
includes income from contracts with customers, levies, grants and income from the Mineworkers’
Pension Scheme.
The Departmental Group is required to identify receipts which it collects on behalf of the Consolidated
Fund; these are not recognised as income but instead are disclosed in a separate Trust Statement
published alongside these accounts and in note 4 in the Statement of Parliamentary Supply (SoPS)
in the Accountability Report.
Operating income from contracts with customers
Income from contracts with customers are allocated to individual promises, or performance
obligations, on a stand-alone selling price basis, and is recognised when the related performance
obligation is satisfied, either over time or at a point in time.
The performance obligations are typically satisfied upon delivery of goods and services in accordance
with the contractually defined timescales. The payment terms for the invoices are typically 30 days.
Where the Departmental Group receives consideration prior to the transfer of goods and services,
the amount is recorded as contract liabilities. Where the Departmental Group has transferred goods
and services to a customer and the right to consideration is conditioned on something other than the
passage of time, the amount is recorded as contract assets.
The measurement of income takes account of significant financing components, variable
consideration, and any discounts or rebates.
Levies
Levy income is recognised in the Departmental Group accounts when an event has occurred that
creates an obligation on a counterparty to pay the levy, the amount can be reliably measured, and it
is probable that the assisted economic benefits from the taxable event will flow to the Departmental
Group. Levies are typically set on an annual basis, invoiced monthly, quarterly or bi-annually, and
accounted for in the period to which the invoices are related to and performance obligations
are satisfied.
The Low Carbon Contracts Company Ltd (LCCC) and Electricity Supply Company Ltd (ESC) are
permitted to retain levies collected under statute and classified as taxes in the National accounts.
This income is recognised by LCCC and ESC in the same period as the related expenditure. LCCC
and ESC do not prepare their individual accounts under FReM and have judged that IFRS 15 does
not apply to income from electricity suppliers. IFRS 15 is applicable to the Departmental Group’s
remaining levy income under FReM guidance.

126
Annual report and accounts 2019-20
The Departmental Group is not permitted by the FReM to recognise tax income relating to future
years, whereas LCCC, which does not apply the FReM, is able to. Adjustments are made on
consolidation to ensure compliance with the Departmental Group accounting policy. There are no
changes in the recognition and measurement of levy income under IFRS 15.
Grant income
Grant income including European funding is recognised when there is reasonable assurance that there
are no conditions attached, or that any such conditions have been complied with and it is certain the
grant will be received. Research grants and fellowships are recognised in line with a schedule of
pre-agreed payment profiles, which include matching considerations over the period of the grant
duration and to the period which they relate. Where the terms and conditions do not specify a
pre‑agreed payment profile or other matching considerations, obligations are recognised in full.
Where the profile indicates an unclaimed and/or unpaid amount exists at the reporting date,
such sums are accrued.
Income from the Mineworkers’ Pension Scheme
Income arising from the Government guarantee of certain benefits payable to members and
beneficiaries of the Mineworkers’ Pension Scheme is recognised when the Core Department
becomes entitled to the income and the value can be reliably measured.
In 2018-19 the Departmental Group adopted IFRS 15 ‘Revenue from Contracts with
Customers’
IFRS 15 ‘Revenue from Contracts with Customers’ replaced IAS 18 ‘Revenue’ and IAS 11
‘Construction Contracts’ and was adopted by the public sector from 1 April 2018. IFRS 15 requires
the Departmental Group to apportion revenue earned from contracts to individual promises, or
performance obligations, on a stand-alone selling price basis, based on a five-step model. The FReM
removed the option to adopt IFRS 15 retrospectively, and therefore any difference between the
previous carrying amount and the carrying amount under IFRS 15 was recognised as adjustments
to opening balances on 1 April 2018.
The impacts on significant income streams of adopting IFRS 15 in 2018-19 are set out below:
Sales of goods and services
Within the scope of IFRS 15, the stream of income that has been significantly affected was
£850 million from the service contracts held by Nuclear Decommissioning Authority (NDA) for fuel
reprocessing, waste and product storage, and the transportation of spent fuel, waste and products.
Due to the limited availability of consistent historical data relating to the contracts and the extent to
which the contracts and associated assumptions have changed over time, NDA obtained a
derogation from HM Treasury to apply IFRS 15 on first-time adoption in 2018-19 on a prospective
basis, and therefore, was not required to report any retrospective adjustments for prior years.
A derogation was granted to the Departmental Group to this effect.
In order to produce a consistent measurement of fulfilment of the remaining performance obligations
under the waste treatment elements of the respective spent fuel reprocessing contracts, NDA has
determined that the remaining revenue on overseas reprocessing contracts would be recognised over
the remainder of the period in which waste treatment services for all wastes produced by the Thorp
reprocessing plant would be completed (currently expected to conclude in 2025). This meant that
the completion of the programme will be treated as a single performance obligation under a single
contract and as a result there was a non-recurring adjustment to the contract loss provision in NDA’s
and the Departmental Group’s SoFP.
Levy income
IFRS 15 is applicable to the Departmental Group’s levy income under the FReM guidance. There were
no changes in the recognition and measurement of levy income under the adoption of IFRS 15.

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Financial Statements
Fees, charges and recharges
The Departmental Group’s income from fees, charges and recharges was reassessed under the
adoption of IFRS 15. However, there were no changes in the recognition or measurement of fees,
charges and recharges on the adoption of IFRS 15.
Grant income
Under the FReM, grants and grants-in-aid should be accounted for in accordance with IAS 20
‘Accounting for Government Grants and Disclosure of Government Assistance’ as interpreted by
the FReM. The grant income is and continues to be out of the scope of IFRS 15.
Income from Mineworkers’ Pension Scheme
Income of £474 million was recognised during 2018-19 (£nil in 2019-20) relating to the Government
guarantee of certain benefits payable to members and beneficiaries of the Mineworkers’ Pension
Scheme. The Government is entitled to a portion of any periodic valuation surpluses determined by
the Government Actuary following triennial valuations. The cash amounts are to be received annually
up to 2027. The Coal Pension receivables have been classified as held at amortised cost under IFRS
9 ‘Financial Instruments’. The associated income, therefore, is out of scope of IFRS 15.
1.9 Staff costs
Staff costs are recognised as expenses when the Departmental Group becomes obligated to pay
them, including the cost of any untaken leave entitlement.
1.10 Grants payable
Grants payable are recognised when the grant recipient has performed the activity that creates an
entitlement to the grant under the terms of the scheme and include estimates for claims not yet
received. Grant contributions to international organisations in the form of promissory notes are
recognised as expenses when they become payable on demand with the Department exercising
no further control over disbursement.
1.11 Taxation
The Core Department and its Agencies are exempt from corporation tax by way of Crown exemption.
Some consolidated bodies are subject to corporation tax on taxable profits. Current tax assets and
liabilities are measured at the amount expected to be recovered from or paid to HM Revenue and
Customs, based on tax rates and laws that are enacted or substantively enacted by the reporting
date.
Value Added Tax (VAT) is accounted for in the accounts, in that the amounts are shown net of VAT
except for irrecoverable VAT, which is aggregated with the cost of purchased items.
Deferred tax is recognised on temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts for financial reporting purposes. Deferred tax assets are
recognised for all tax-deductible temporary differences, carry forward of unused tax credits and
unused tax losses to the extent that it is probable that taxable profit will be available in future years
against which they can be utilised.
1.12 Property, plant and equipment (PPE)
Assets are capitalised as PPE if they are intended for use on a continuing basis and their original
carrying value, on an individual or asset pool basis, exceeds the relevant capitalisation threshold which
ranges from £1,000 to £10,000 across the Departmental Group. Exceptions are: a) assets held by the
NDA on designated nuclear sites are only recognised where the economic element of their value at
the reporting date exceeds £100,000 and the proportion of asset value relating to commercial activity
exceeds 10%; and b) operational mine water schemes and subsidence pumping stations are held by
the Coal Authority at £nil value because they are used to address pollution caused by past mining
activities where the economic benefits have already been received.

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Annual report and accounts 2019-20
To the extent that it has been recognised as a provision under IAS 37, the estimated cost of
decommissioning facilities is recognised as part of the carrying value of the asset at initial recognition
and depreciated over its useful life.
Valuation of PPE
PPE is carried at fair value except for nuclear waste management assets held at historical cost
(see note 1.2) and assets under construction which are held at cost. In accordance with the FReM,
assets that have short useful lives or are of low value are carried at depreciated historical cost less
impairment as a proxy for fair value.
Non-specialist land and buildings are measured at current value in existing use using professional
valuations. Specialist land and buildings are measured at depreciated replacement cost which
represents the present value of the asset’s remaining service potential.
Revaluation of PPE
Any accumulated depreciation at the date of revaluation is eliminated and the resulting net book value
restated to equal the revalued amount. Any revaluation increase arising is credited to the revaluation
reserve except to the extent that it reverses a revaluation decrease for the same asset previously
recognised as an expense in which case the increase is credited to net expenditure for the year to the
extent of the decrease previously charged. A decrease in carrying amount arising on revaluation is
charged as an expense to the extent that it exceeds the balance, if any, held in the revaluation reserve
relating to a previous revaluation of that asset. On de-recognition, any revaluation surplus remaining in
the Revaluation reserve attributable to the asset is transferred directly to the General Fund.
Depreciation of PPE
Apart from freehold and long leasehold land which are not depreciated, PPE assets are depreciated to
estimated residual values on a straight-line basis over the following estimated useful lives:
Freehold buildings
10 – 60 years
Leasehold land and buildings
10 – 60 years or remaining life of lease
Agricultural buildings
Up to 60 years
Dwellings
Up to 60 years
Leasehold improvements
Shorter of estimated remaining useful life or outstanding
term of lease
Computer equipment
2 – 10 years
Plant and machinery
3 – 50 years or remaining life of lease
Office machinery (included in plant and machinery), furniture,
fixtures and fittings
2 – 11 years or remaining life of lease
Transport equipment
2 – 14 years
Ships (included in transport equipment)
Minimum of 20 years
Aircraft (included in transport equipment)
Minimum of 15 years
Assets under construction
Not depreciated until available for use as intended by
management
Residual values and useful lives are reviewed and adjusted if appropriate at each reporting date.
1.13 Investment property
The Departmental Group holds a number of properties which have been classified as investment
properties and are measured using the fair value model specified in IAS 40. Gains and losses arising
from changes in fair value are recognised in net expenditure for the year.

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Financial Statements
1.14 Intangible non-current assets
Intangible non-current assets are capitalised if they are intended for use on a continuing basis and
their original carrying value, on an individual or asset pool basis, exceeds the relevant capitalisation
threshold which ranges from £1,000 to £10,000 across the Departmental Group. There are no active
markets for the majority of the Departmental Group’s intangible non-current assets which are valued
at the lower of depreciated replacement cost and value in use using a valuation technique (for
example for income-generating assets); where there is no value in use, depreciated replacement cost
is used. Where there is an active market, the valuation is derived from the active market. Assets of low
value or with short useful lives are carried at cost less accumulated amortisation and impairment
losses as a proxy for fair value. They are amortised on a straight-line basis over the following periods:
Software licenses
3 – 10 years
Internally developed software
Up to 10 years
Website development costs
2 – 5 years
Patents, licenses and royalties
7 – 15 years
1.15 Impairment of PPE and intangible non-current assets
The Departmental Group reviews carrying amounts at each reporting date. If an indicator for
impairment occurs then the recoverable amount of the asset (the higher of fair value less costs to sell
and value in use) is estimated and an impairment loss recognised to the extent that it is lower than the
carrying amount. Losses arising from a clear consumption of economic benefit are charged to net
expenditure for the year. Losses that do not result from a loss of economic value or service potential
are taken to the revaluation reserve to the extent that a revaluation reserve exists for the impaired
asset; otherwise to Net expenditure for the year.
1.16 Assets held for sale
Assets are classified as held for sale if their carrying amount will be recovered through a sale
transaction rather than through continuing use. This condition is regarded as met only when the sale
is highly probable, the asset is available for immediate sale in its present condition and the asset is
actively marketed for sale. Management must be committed to the sale which should be expected to
qualify for recognition as a completed sale within one year from the date of classification. Assets held
for sale are measured at the lower of a) carrying amount and b) fair value less costs to sell.
1.17 Cash and cash equivalents
Cash and cash equivalents comprise cash in hand and other short term highly liquid investments
which are readily convertible to known amounts of cash are subject to insignificant risk of changes in
value and have an original maturity of three months or less. Any bank overdraft amounts are included
within trade payables and other liabilities
1.18 Leases
The Departmental Group continues to apply IAS 17 ‘Leases’ for 2019-20, recognising leases assets
as either operating or finance leases. Leases are classified as finance leases when the risks and
rewards of ownership are transferred substantially to the lessee; all other leases are classified as
operating leases.
Finance leases
Departmental Group as lessor
Amounts due from lessees under finance leases are recognised as receivables at the amount of the
Departmental Group’s net investment in the lease. Finance lease income is allocated to accounting
periods so as to reflect a constant periodic rate of return on the Departmental Group’s net investment
outstanding in respect of the leases.

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Annual report and accounts 2019-20
Departmental Group as lessee
Assets subject to finance leases and the associated liabilities for future payments (if any) are
recognised in the SoFP.
Operating leases
Departmental Group as lessor
Assets subject to operating leases are recognised in the SoFP with rental income plus initial direct
costs incurred in arranging the lease, including incentives to the lessee to enter into the lease,
recognised on a straight-line basis over the lease term.
Departmental Group as lessee
Rentals payable under operating leases, including benefits received and receivable as incentives to
enter into leases, are expensed on a straight-line basis over the term of the lease.
1.19 Subsidiaries, associates and joint ventures
Subsidiaries and public sector joint ventures are consolidated where designated within the
Departmental Group boundary (note 27); those outside the Departmental Group boundary are
measured in accordance with IFRS 9. Equity investments in associates or joint ventures outside the
public sector are initially recorded at cost and subsequently adjusted to reflect the Departmental
Group’s share of net profit or loss of the associate or joint venture.
1.20 Financial instruments
Financial assets and liabilities are measured initially at fair value plus transaction costs unless carried
at fair value through profit or loss in which case transaction costs are charged to Net expenditure for
the year. Fair value is determined by reference to quoted prices where an active market exists for the
instrument; otherwise it is determined using generally accepted valuation techniques including
discounted estimated cash flows. A regular way purchase or sale of financial assets shall be
recognised and derecognised, as applicable, using settlement date accounting.
Financial assets
Financial assets are derecognised when the rights to receive future cash flows have expired or are
transferred and the risks and rewards of ownership have been substantially transferred.
Categories of financial asset
Financial assets are categorised as one of the following:
• Amortised cost are financial assets whose cash flows are the solely payments of principal and
interests and the business model of which is to hold for collecting contractual cash flows only.
They are initially recognised at fair value and thereafter at amortised cost using the effective interest
method less any impairment. The effective interest rate method is a method of calculating the
amortised cost of a financial asset and of allocating interest income over the relevant period.
• Fair value through Other Comprehensive Income (FVOCI) are either:
(i) debt instruments whose cash flows are the solely payments of principal and interests and the
business model of which is to hold for both collecting contractual cash flows and selling.
(ii) equity instruments that are neither held for trading nor contingent consideration recognised in a
business combination, as the Departmental Group has made an irrevocable election at initial
recognition.
After initial recognition, these assets are subsequently carried at fair value. Gains and losses
in fair value are recognised directly in equity. On de-recognition, the cumulative gain or loss
previously recognised in equity is recognised in Net expenditure for the year for debt
instruments and transferred to General Fund for equity instruments.

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Financial Statements
• Fair value through profit or loss (FVTPL) are any financial assets that are not measured at amortised
cost or FVOCI. Transaction costs and any subsequent movements in the valuation of the asset are
recognised in net expenditure for the year.
Impairment of financial assets
Financial assets other than equity instruments and those at FVTPL are assessed for impairment at
each reporting date using the expected credit loss (ECL) model. The three-stage model based on the
level of credit risk is applied to any financial assets other than long term trade receivables, contract
assets which do contain a significant financing component and lease receivables within the scope of
IAS 17 as follows:
• For financial assets with low credit risk or assets that have not had a significant increase in credit
risk since initial recognition, 12-month ECL are recognised and interest revenue is calculated on the
gross carrying amount of the asset without the reduction of credit allowance.
• For financial assets that have had a significant increase in credit risk since initial recognition but that
do not have objective evidence of impairment, lifetime ECL are recognised and interest revenue is
calculated on the gross carrying amount of the asset.
• For financial assets that have objective evidence of impairment at the reporting date, lifetime ECL are
recognised and interest revenue is calculated on the net carrying amount net of credit allowance.
Impairment gains or losses, the amount of expected credit losses (or reversal) that is required to
adjust the loss allowance at the reporting date to the amount that is required to be recognised in
accordance with the Standard, are recognised in profit or loss.
For long term trade receivables, contract assets which do not contain a significant financing
component and lease receivables within the scope of IAS 17 ‘Leases’, the simplified approach is
applied and lifetime ECL are recognised as dictated by the FReM.
Financial liabilities
Financial liabilities are derecognised when the obligation is discharged, cancelled or expires.
The Departmental Group’s financial liabilities excluding derivatives are initially recognised at fair value
including directly attributable transaction costs, and subsequently at amortised cost using the effective
interest rate method.
Derivative financial instruments
Derivatives are initially recognised at fair value and subsequently at fair value. Gains/losses in fair value
are recognised in net expenditure for the year unless hedge accounting is applied.
The Departmental Group has two classes of derivative financial instrument, foreign exchange
contracts to which hedge accounting is applied and CfDs to which hedge accounting is not applied.
Forward foreign exchange contracts
Forward contracts are held as cash flow hedges to reduce exposure to foreign currency risk.
The effective portions of changes in their fair values are recognised in equity. Gains and losses
relating to ineffective portions are recognised immediately in Net expenditure for the year.
Amounts accumulated in equity are recycled to Net expenditure for the year in the same period as
the hedged item.
Contracts for Difference (CfDs)
CfDs are held to incentivise investment in low carbon electricity generation by agreeing strike prices
with electricity generators which are counterparties to the contracts. The counterparty pays, or is
paid, the difference between the strike price and the reference price (a measure of the average market
price of electricity) at the time of electricity supply. CfDs are measured at FVTPL, initially at their
transaction price (£nil) with subsequent changes in fair value (as measured by a valuation model)
recognised in Net expenditure for the year. Where the valuation model estimate of fair value at initial

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Annual report and accounts 2019-20
recognition is different from the transaction price, the difference is deferred and amortised to Net
expenditure for the year over the contract settlement period (note 9).
In 2018-19 the Departmental Group adopted IFRS 9 ‘Financial Instruments’
IFRS 9 ‘Financial Instruments’ replaced IAS 39 ‘Financial Instruments: Recognition and Measurement’
and was adopted by the public sector from 1 April 2018. The FReM removed the option to adopt
IFRS 9 retrospectively, and therefore the Departmental Group recognised any adjustments to the
carrying amounts of financial assets and liabilities at the date of transition in the opening retained
earnings and other reserves of the previous period. Consequently, amendments to IFRS 7 ‘Financial
Instruments: Disclosures’ were also applied to the previous period only. The adoption of IFRS 9
resulted in changes to the accounting policies for classification, measurement and impairment of
financial assets in the 2018-19 financial statements. These accounting policies are unchanged in the
2019-20 financial statements.
Classification and measurement of financial assets
IFRS 9 contains three principal classification categories for financial assets: amortised cost, fair value
through other comprehensive income (FVOCI), and fair value through profit or loss (FVTPL). The
classification of financial assets under IFRS 9 is based on the business model in which a financial
asset is managed and its contractual cash flow characteristics. IFRS 9 removes the previous IAS 39
categories of held to maturity, loans and receivables and available for sale. Derivatives embedded in
contracts where the host is a financial asset in scope of the standard are never separated. Instead,
the hybrid financial instrument as a whole is assessed for classification.
Under IFRS 9, the requirement for classifying and measuring financial assets is that:
• Loans and other debt instruments are classified as either amortised cost, FVOCI or FVTPL,
dependent on the business model and cash flow characteristics of the financial assets
• Investments in equity instruments are classified as FVTPL, unless an irrevocable election is made on
initial recognition to recognise subsequent changes in fair value in Other Comprehensive Income
(OCI). The election is only available to equity instruments that are not held for trading.
• Derivatives are classified as FVTPL
Classification and measurement of financial liabilities
Financial liabilities are classified and subsequently measured at amortised cost, except for:
• Financial liabilities at fair value through profit or loss, which is applied to derivatives and other
financial liabilities designated as such at initial recognition
• Financial liabilities arising from the transfer of financial assets which did not qualify for derecognition,
whereby a financial liability is recognised for the consideration received for the transfer
• Financial guarantee contracts and loan commitments
Impairment
IFRS 9 replaced the ‘incurred loss model’ in IAS 39 with a forward looking ‘expected credit loss’ (ECL)
model. The ECL model applies to financial assets measured at amortised cost, contract assets and
debt investments at FVOCI, but not to investments in equity instruments and FVTPL financial assets.
The impairment methodology is detailed in the financial instruments note 22.
(a) Reconciliation of carrying amounts of financial assets under IAS 39 and IFRS 9
The following table reconciles the carrying amounts of financial assets under IAS 39 to the carrying
amounts under IFRS 9 on 1 April 2018: The Investment fund and Receivables reconciliation in table
below has been restated to include the restatement relating to BIS Postal Service Company (see note
26) for more information.

133
Financial Statements
Restated
Reconciliation
Carrying amount under
IFRS 9 at 1 April 2018
Carrying
amount
under IAS
39 at
31 March
2018
Transfer
between
cate-
gories
Transfer
to
associ-
ates
Transfer of
embedded
derivatives
Remeasure-
ment under
IFRS 9
Carrying
amount
under
IFRS 9 at
1 April
2018
Amortised
cost
FVOCI
design-
ated
FVTPL
£m
£m
£m
£m
£m
£m
£m
£m
£m
Loans and
Receivables
Cash and cash
equivalents
2,034
–
–
–
–
2,034
2,034
–
–
Receivables
2,001
–
–
–
(8)
1,993
1,993
–
–
Loans to public sector
bodies
943
–
–
–
–
943
943
–
–
Loans to private sector
entities
598
61
–
–
2
661
661
–
–
Term deposits
7
–
–
–
–
7
7
–
–
Held to maturity
Term deposits
7
–
–
–
–
7
7
–
–
Available for sale
Repayable Launch
Investments
1,047
–
–
–
–
1,047
–
–
1,047
Ordinary shares in public
sector entities
1,337
–
–
–
–
1,337
–
1,337
–
Ordinary shares in
private sector entities
–
99
–
–
–
99
–
99
–
Property related holdings
42
(42)
–
–
–
–
–
–
–
Equities (listed securities)
269
(269)
–
–
–
–
–
–
–
Private equities
317
(317)
–
–
–
–
–
–
–
Investment funds
1,321
544
–
31
6
1,902
–
–
1,902
Other investments
669
(76)
(461)
–
–
132
–
–
132
Bonds
59
–
–
–
(1)
58
58
–
–
Fair value through
profit or loss
Derivatives
109
–
–
(31)
–
78
–
–
78
Total financial assets
10,760
–
(461)
–
(1)
10,298
5,703
1,436
3,159
The application of IFRS 9 in 2018-19 resulted in the reclassifications set out in the table above and
explained below:
• Cash and cash equivalents, receivables, loans to public sector bodies, and term deposits that were
classified as ‘loans and receivables’ and ‘held to maturity’ were measured at ‘amortised cost’.
There were no changes in terms of measurement for these assets upon transition.
• Loans to private sector entities that were classified as ‘loans and receivables’ under IAS 39 meet
the solely payments of principal and interest test for cash flows characteristics. The objective of the
business model is achieved by collecting the contractual cash flows only and therefore, they were
classified as ‘amortised cost’ under IFRS 9. An adjustment for the impairment allowance of £2
million calculated under the ECL model was recognised in retained earnings at 1 April 2018.
• Bonds were classified as ‘available for sale’ and were measured at ‘amortised cost’ under IFRS 9 in
2018-19. The Departmental Group’s intention is to hold these bonds for collecting contractual cash
flows only. Sale of the bonds only happens infrequently when there is an increase in the assets’
credit risk. Their cash flows are solely payments of principal and interest. Upon transition, the
cumulative gain previously recognised in OCI was removed from equity and applied against the fair
value of the financial asset at the reclassification date resulting in an adjustment of £1 million to
retained earnings and carrying amount of the asset at 1 April 2018.

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Annual report and accounts 2019-20
2019
From available for sale (IAS 39) to Amortised Cost
£m
Fair value as at 31 March 2018
59
Fair value gain/ (loss) that would have been recognised during the year if the financial asset had not
been reclassified.
(1)
• Repayable launch investments were classified as ‘available for sale’ with the revaluation movements
previously going through OCI. As the repayments are contingent on the sales of the products, they
do not meet the solely payments of principal and interest test and are measured at ‘FVTPL’.
On adoption, the cumulative gain or loss previously recognised in Revaluation Reserve of £235m
as at 31 March 2018 was transferred to the Taxpayer’s Equity.
• Ordinary shares in consolidated public sector entities were held at Cost under IAS 39/IAS 27;
this continues to be permitted under IFRS 9/IAS 27.
• Ordinary shares in non-consolidated public sector entities in accordance with the FReM were
classified as ‘available for sale’. The Departmental Group intends to hold these, for long-term
strategic purposes, and as permitted by IFRS 9, designated these investments at the date of initial
application as measured at ‘FVOCI’.
• Ordinary shares in private sector entities were classified as ‘available for sale’ under IAS 39.
The Departmental Group intends to hold these for long term strategic purposes, and as permitted
by IFRS 9, designated these investments at the date of initial application as measured at ‘FVOCI’.
• Investment funds were classified as ‘available for sale’. The holdings are standard investment funds
with either a limited life or redeemable units, and measured at ‘FVTPL’ as they are debt instruments
that do not meet the solely payments of principal and interest test.
– On adoption, the cumulative gain or loss previously recognised in Revaluation Reserve of
£926 million as at 31 March 2018 was transferred to the Taxpayer’s Equity.
– The category transfer of £31 million from investment funds to ordinary shares in non-public sector
entities was related to the ordinary share holding in the Global Climate Partners Fund, which is an
investment company rather than a standard limited partnership fund with a limited life.
• Loans that were previously classified as ‘available for sale’ within the Other Investments category
are those held by UKGIP. As they are held to sell, not to collect contractual cash flows, they fail the
business model test and were classified as ‘FVTPL’ under IFRS 9.
• Derivatives were classified as ‘fair value through profit and loss’ under IAS 39 and remain measured
at ‘FVTPL’ under IFRS 9. However, embedded derivatives are no longer assessed separately from
the host financial asset which lead to a category transfer of £31 million from derivatives to
investment funds.

135
Financial Statements
(b) Reconciliation of carrying amounts of financial liabilities under IAS 39 and IFRS 9
The following table reconciles the carrying amounts of financial liabilities under IAS 39 to the carrying
amounts under IFRS 9 on 1 April 2018:
Restated
Reconciliation
Carrying amount under IFRS 9
at 1 April 2018
Carrying
amount
under IAS
39 at
31 March
2018
Transfer
from
provisions
Remeasure-
ment under
IFRS 9
Carrying
amount
under
IFRS 9 at
1 April
2018
Amortised
cost
FVTPL
designated
FVTPL
mandatory
Other
£m
£m
£m
£m
£m
£m
£m
£m
Fair value through profit
or loss
Derivatives
(15,915)
–
–
(15,915)
–
–
(15,915)
–
Other liabilities
Payables
(2,175)
–
–
(2,175)
(2,175)
–
–
–
Financial guarantee
liabilities
(61)
–
16
(45)
–
–
–
(45)
Loan commitment liabilities
–
(184)
–
(184)
–
(184)
–
–
Total financial liabilities
(18,151)
(184)
16
(18,319)
(2,175)
(184)
(15,915)
(45)
The explanations of changes to financial liabilities under IFRS 9 are set out below:
• The Core Department’s financial guarantee liabilities were remeasured under IFRS 9, leading to
£16 million decrease in the carrying amount, which was recognised in the adjustment to the general
fund opening balances.
• The British Business Bank (BBB)’s Enterprise Capital Fund commitments to provide loans under
market rates were designated under IFRS 9 to be measured at fair value through profit or loss
because the Departmental Group of financial assets and financial liabilities is managed and its
performance is evaluated on a fair value basis, in accordance with a documented investment
strategy and information is provided internally on that basis to the key management personnel.
For clarity, the loan commitment liabilities were transferred out from provisions to be disclosed
together with financial guarantee liabilities.

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Annual report and accounts 2019-20
(c) Impacts of transition to financial statement line items
The following table summarises the impact of transition to IFRS 9 on assets, revaluation reserve and
general fund at 31 March 2018. The Receivables and Other financial assets reconciliation in the table
below has been restated to include the restatement relating to BIS Postal Service Company (see note
26 for more information).
Restated
Closing
balance
under
IAS 39 at
31 March
2018
Transfers
Gross
carrying
amount
remeasure-
ment under
IFRS 9
Expected
credit loss
remeasure-
ment under
IFRS 9
Remeasure-
ment under
IFRS 9
Opening
balance
under
IFRS 9 at
1 April 2018
£m
£m
£m
£m
£m
£m
Receivables
2,001
–
–
(2)
(6)
1,993
Total impact on current assets
n/a
–
–
(2)
(6)
n/a
Other financial assets
4,336
(430)
27
(25)
5
3,913
Investments in joint ventures and
associates
367
461
–
–
–
828
Total impacts on non-current assets
n/a
31
27
(25)
5
n/a
Derivatives
(15,806)
(31)
–
–
–
(15,837)
Provisions
(240,935)
184
–
–
–
(240,751)
Financial guarantee and loan
commitment liabilities
(61)
(184)
16
–
–
(229)
Total impacts on non-current
liabilities
n/a
(31)
16
–
–
n/a
General fund
250,098
(926)
(43)
27
1
249,157
Revaluation reserve
(2,915)
926
–
–
–
(1,989)
Total impacts on reserves
n/a
–
(43)
27
1
n/a
1.21 Financial guarantees and loan commitments
Financial guarantee contract liabilities
Financial guarantees are initially recognised at fair value on the date the guarantee was given and
subsequently remeasured at the higher of a) the amount of loss allowance determined in accordance
with IFRS 9 ‘Financial Instruments’ and b) the amount initially recognised less when appropriate,
cumulative amortisation in accordance with IFRS 15 ‘Revenue from Contracts with Customers’.
Loan commitments at below market rate
The Departmental Group accepts a lower than market rate of return from Enterprise Capital Fund
investments in order to encourage private sector investors to invest alongside. Although the
Departmental Group expects to make a positive return from these investments, this return is less than
that required by the private sector. The Departmental Group has, at initial recognition, elected to
irrevocably designate the liability related to these loan commitments as measured at fair value through
profit or loss because the group of financial assets and financial liabilities is managed, and its
performance is evaluated on a fair value basis, in accordance with a documented investment strategy,
and information is provided internally on that basis to the key management personnel.
1.22 Pensions
The accounting for each of the Departmental Group’s pension plans is dependent on its nature.
Funded defined-benefit pension schemes
The Departmental Group has nine funded defined-benefit pension schemes, the Medical Research
Council Pension Scheme (MRCPS), two schemes through the NDA and six others through the nuclear
site licence companies.

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Financial Statements
The net liabilities recognised in the SoFP for funded defined benefit schemes are calculated by
independent actuaries by deducting the fair value of scheme assets (at bid prices) from the present
value of defined benefit obligations (estimated using the projected unit credit method, less any
amounts receivable from third parties). Where the scheme is in surplus, the asset recognised in
these statements is limited to the present value of benefits available from future refunds from the plan,
reductions in future contributions to the plan or on settlement of the plan and takes into account the
adverse effect of any minimum funding requirements. Actuarial gains and losses are recognised as
Other Comprehensive Income and Expenditure except for site licence companies where they are
included in provision expense relating to the Nuclear Decommissioning provision.
Unfunded defined benefit pension schemes
The Departmental Group contributes towards a number of unfunded defined benefit pension schemes
of which employees are members: these include the Principal Civil Service Pension Scheme (PCSPS),
the Civil Servant and Other Pension Scheme (CSOPS) and the Combined Pension Scheme of the
UKAEA. The participating employers in these schemes are unable to identify their share of the
underlying net liability; as such these schemes are accounted for as defined contribution pension
schemes, with employers contributions charged to the SoCNE in the period to which they relate.
Further information regarding PCSPS and CSOPS is presented in the Staff Report.
Defined contribution pension schemes
Contributions are charged to the SoCNE when they become payable. The Departmental Group has
no further liabilities in respect of benefits to be paid to members.
More information about the Departmental Group’s pension schemes can be found in the accounts of
the consolidated entities, including in note 3 for the Core Department, and of the pension schemes
themselves.
1.23 Provisions
A provision is recognised when it is probable that an outflow of economic benefits will be required to
settle a present obligation (legal or constructive) that can be reliably measured and which results from
a past event. Where the time value of money is material the provision is measured at present value
using discount rates prescribed by HM Treasury. HM Treasury issues nominal rates that do not take
account of inflation, unlike real rates. Using these nominal rates, the cash flows are inflated using the
following inflation rates provided by HM Treasury except where a more appropriate forecast has been
identified for specific provisions.
31 March 2020
31 March 2019
Nominal
discount
rate
Inflation
rate
Equivalent
real
discount
rate
Nominal
discount
rate
Inflation
rate
Equivalent
real
discount
rate
Cash outflows expected within two
years
0.51%
1.9%
(1.36%)
0.76%
2.0%
(1.22%)
Cash outflows expected between
two and five years
0.51%
2.0%
(1.46%)
0.76%
2.1%
(1.31%)
Cash outflows expected between
five and ten years
0.55%
2.0%
(1.42%)
1.14%
2.1%
(0.94%)
Cash outflows expected after ten
years
1.99%
2.0%
(0.01%)
1.99%
2.1%
(0.11%)
Nuclear decommissioning provisions
Where expenditure in settlement of a provision is expected to be recovered from a third party, the
recoverable amount is treated as a separate asset (note 12). Provision charges in the SoCNE are
shown net of changes in these recoverable amounts.

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Annual report and accounts 2019-20
1.24 Contingent assets and liabilities
Where an outflow of economic benefits from a past event is possible but not probable, the
Departmental Group discloses a contingent liability. In addition to contingent liabilities disclosed in
these financial statements in accordance with IAS 37 ‘Provisions, Contingent Liabilities and
Contingent Assets’, certain statutory and non-statutory contingent liabilities where the likelihood of
a transfer of economic benefit is remote are disclosed in the Accountability Report for Parliamentary
reporting and accountability purposes.
Where an inflow of economic benefits from a past event is probable, the Departmental Group
discloses a contingent asset. Estimates of the financial effects are disclosed where practicable; where
the time value of money is material, contingent liabilities and assets are stated at discounted amounts
and the amount reported to Parliament separately noted. Remote contingent liabilities reported in the
Accountability Report are stated at the amounts reported to Parliament.
1.25 Third party assets
The Departmental Group holds, as custodian or trustee, certain cash balances belonging to third
parties. These balances are not recognised in the financial statements since neither the Departmental
Group nor Government more generally has a direct beneficial interest in them.
1.26 Judgements, estimates and assumptions
Preparation of financial statements requires management to make judgements, estimates and
assumptions based on experience and expected events that affect the reported amounts of assets
and liabilities, income and expenditure. Key accounting judgements applied in these statements are
described below.
Judgements
Recognition of Hinkley Point C CfD (note 9)
The Department (through LCCC) entered into HPC CfD on 29 September 2016. This project has a
maximum lifetime generation cap of 910,000,000MWh. The contract will expire at the earlier of 35
years after the start date of the second reactor or when the total CfD payments made have reached
the generation cap.
Under IFRS, the Conceptual Framework sets out the concepts which underlie the preparation and
presentation of financial statements. The Conceptual Framework deals with, amongst other things,
the definition, recognition and measurement of the elements from which financial statements are
constructed. Paragraph 4.38 of the Conceptual Framework states that an element should be
recognised in the accounts if:
a)
it is probable that any future economic benefit associated with the item will flow to or from the
entity; and
b)
the item has a cost or value that can be measured with reliability (defined as using information
that is complete, neutral and free from error).
The HPC CfD duration is more than double (35 years) the length of other CfDs (15 years) entered into
by the Department (through LCCC). This has made it considerably more challenging for management
to provide a reliable single point fair value estimate for HPC CfD. In order to perform a reliable estimate
of the valuation one of the required key inputs is wholesale electricity prices in each year out to 2060.
Historically the Department (through LCCC) had not been able to obtain wholesale electricity price
forecasts which cover the unusually long period of the contract, thereby preventing a reliable estimate
being made. As a result of this the Department has previously been unable to recognise HPC CfD in
the financial statements

139
Financial Statements
Update on the recognition of Hinkley Point C CfD during 2019-20
During the year the Department using the Dynamic Dispatch Model (DDM), has been able to estimate
reliably wholesale electricity prices out to 2060. The Department’s DDM model forecasts wholesale
electricity prices out to 2050. However, in the current year, the Department has deemed it possible to
‘freeze’ the 2050 model forecasts for all subsequent years out to 2060. The main driver facilitating the
Department’s ability to do this has been the government’s commitment in 2019-20 to bring all
greenhouse gas emissions to Net Zero by 2050, therefore giving more certainty over potential
generation mixes into the future. Legislation now commits the UK to an economy wide target of Net
Zero carbon emissions. The Department’s modelling strategy is designed to optimise the costs of
decarbonisation across the economy, which determines the power sector demand, and the maximum
level of emissions. The Department have picked generation mixes which optimise the cost of the
power sector. In the absence of any exogenous change, the Department anticipate that the UK would
maintain an optimised system ad-infinitum. As a result of this, the Department has been effectively
able to ‘freeze’ the 2050 model for all subsequent years. Therefore, the generation mix and associated
system costs and wholesale price of electricity that the Department project for 2050, remains
constant for the remaining period of the forecast.
In addition to the availability of the DDM forecast, the Department (through LCCC) was able to
commission an independent third party to provide a forecast for the power market in Great Britain to
2065. The forecast received from the third party has been used as reference to support the
reasonableness of the internally generated price series.
As a result, the reasonableness of the underlying assumptions of the forecast to 2060, management
deem the valuation of the HPC CfD as a reliable estimate that is complete, neutral and free from error.
Therefore, in line with the recognition criteria for the other CfDs, the recognition criteria for HPC CfD is
considered to have been met. As HPC CfD’s fair value calculation is based on the data from the same
model, the same valuation technique is used across the whole portfolio.
Accounting treatment of Hinkley Point C CfD
The date of initial recognition of the Hinkley Point C CfD is the date it becomes capable of reliable
measurement in accordance with the requirements of IFRS 13 and the Conceptual Framework. The
Department (through LCCC) has determined that the estimated fair value of the instrument at the
reporting date is a reasonable proxy for its fair value at the date of initial recognition. This judgement is
not sensitive to the specific date of initial recognition during the financial year, which is a matter of
professional judgement.
On recognition the HPC CfD has followed the same accounting treatment as that adopted for the
other CfDs recognised in the financial statements. The accounting of the fair value of the HPC CfD,
the impact of its recognition within the portfolio, and relevant sensitivity analysis are shown in note 9.
As there were no wholesale price forecasts available prior to the authorisation of the prior year
financial statements to reliably estimate the value of Hinkley Point C CfD and considering the reliable
estimate of the wholesale price forecast to 2060 has only become available in the current financial
year therefore, management believes no prior period adjustment is required.
Small Business Grant Fund and Retail, Hospitality and Leisure Grant Fund recognition point
(note 4.4 and note 28)
The Small Business Grant Fund was announced by the Chancellor during his Budget speech on
11 March 2020 and subsequently extended during the Chancellor’s speech on 17 March 2020 setting
out the government’s economic response to COVID-19. The Retail, Hospitality and Leisure Grant
Fund was also announced during the Chancellors speech on 17 March 2020. The Guidance to Local
Authorities (LAs) setting out how LAs would manage the grants on behalf of the Department was
issued on 24 March 2020. The Guidance to Businesses the ultimate grant recipients was issued on
1 April 2020, the same day as funding was provided from the Departments to LAs to make grant
payments. Due to the impact of COVID-19, LAs were encouraged to make early payments to
eligible grant recipients from their own funds. The Department under the Guidance to LAs and
Section 31 grant notification are legally obligated to reimburse the LAs. Therefore the Core

140
Annual report and accounts 2019-20
Department has recognised a grant accrual of £151 million in note 4.4, for grants paid out by the
LAs before the 1 April 2020.
The Core Department has recognised a provision of £10.8 billion, in addition to the £151 million
recognised as a grant accrual. This is because the announcements and payments made prior to 31
March 2020 created a constructive obligation under IAS 37. This amount is based on eligibility and
payments information received from LAs after 31 March 2020 and has been limited by the closure of
the scheme which is disclosed as an Adjusting Event in note 28. As a result of recognising this
constructive obligation, the Department’s expenditure has increased by £10.8 billion. This has resulted
in a breach of the control limited voted by Parliament and a regularity qualification.
Capacity Market restart (note 4.1 and note 6.1)
On 15 November 2018, the European Court of Justice (ECJ) annulled the European Commission (EC)
decision of July 2014 to grant State Aid clearance to the Capacity Market. The ruling resulted in a
‘Standstill Period’ for the Capacity Market in which no State Aid could be paid out pending the EC’s
redetermination. As a result of this the ESC was not able to make any Capacity Market payments
during the ‘Standstill Period’ and, additionally, no supplier charge was collected.
The EC appealed the ECJ’s decision and, separately, also undertook a formal investigation into the
UK’s notification of the Capacity Market scheme in order to inform its ‘re-decision’ on whether to grant
State Aid clearance. On 24 October 2019, the Department was informed by the EC that it had
completed its State Aid investigation into the Capacity Market and that the Capacity Market scheme
complies with EU State Aid rules. On 25 October 2019, the Department notified ESC and National
Grid to restart their respective Capacity Market activities.
Following the successful restart of the Capacity Market, circa £1.17 billion of invoices were raised to
suppliers in November 2019 relating to the Standstill Period. This in turn enabled payment of the
required £1.15 billion to Capacity Providers (that had been deferred as a result of the Standstill
Period).
No Capacity Market supplier charge income or respective capacity payment expense was recognised
in 2018-19 for the 2018/19 Delivery Year (1 October to 30 September) due to the suspension of the
Capacity Market. Out of the £1.15 billion capacity payment made for the Standstill Period, £0.99
billion related to the 2018/19 Delivery Year of which £0.54 billion would have been recognised in the
financial year ending 31 March 2019 had there been no standstill. The collection of retrospective
supplier charge and capacity payment made for the 2018/19 Delivery Year is recognised as income
and expense, respectively, in the current financial year.
Estimates
In accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors, revisions
to accounting estimates are recognised prospectively. Revisions of the estimates and assumptions
below could cause material adjustment to the carrying amounts of assets and liabilities within the next
financial year.
Income recognition (note 6.1)
A number of significant accounting judgements have been performed to apply IFRS 15 to the
recognition of revenue and costs from contracts with customers held by the NDA, including the
determination of transaction price of each contract, the allocation of transaction price to each
performance obligation, the timing of satisfaction of performance obligations, and the accounting
treatment of contract costs. Detail is included in NDA’s financial statements.
Useful lives of non-current assets
There is uncertainty in relation to estimated useful lives of non-current assets; these are reviewed as at
the reporting date and updated if expectations differ from previous estimates due to physical wear
and tear, technical or commercial obsolescence or legal or other limits on their use.

141
Financial Statements
Impairment of assets (note 4.2, 7, 8, 10, 11, 13, 14, 15, and 22)
Impairment of non-financial assets is measured by comparing the carrying value of the asset or cash
generating unit with management’s estimate of its recoverable amount. Impairment of financial assets
is measured using the expected credit loss model (note 1.20).
Fair value of Repayable Launch Investments (note 11.1)
The econometric model used to estimate future cash flows from Repayable Launch Investments
includes a number of assumptions including on future economic growth.
Fair value of private equity investments (note 11.2)
A range of valuation techniques are used for private equity investments, including discounted cash
flows and net asset values.
Redundancy Payments Service receivable (note 14)
There is uncertainty in the estimate of the amount to be realised by the Insolvency Service from sale
of assets of insolvent employers.
CfD contracts (note 9)
The significant uncertainties affecting measurement of Financial Investment Decision Enabling for
Renewables (FIDeR) and CfD contracts, which facilitate investment in low-carbon electricity
generation, are described in the note.
Fair value of financial guarantees (note 19)
Fluctuations in the fair value of financial guarantees measured using modelling techniques.
Provisions (note 18)
Provision discount rates set by HM Treasury are updated annually and have a material effect on
liabilities There are other significant uncertainties in relation to measurement of the liabilities reported in
note 18, in particular in relation to future decommissioning costs to be incurred by the NDA, UKAEA
and Coal Authority, which are described in the note.
1.27 Prior Period Adjustments
In accordance with the FReM, where a prior period adjustment is identified as a result of an error, the
Departmental Group will correct all material prior period errors retrospectively in the first set of financial
statements authorised for issued after their discovery by:
• Restating the comparative amounts for the prior periods presented in which the error occurred;
• If the error occurred before the earliest prior period presented, restating the opening balances of
assets, liabilities and equity for the earliest prior period presented.
However, if it is impracticable to determine the period-specific effects of an error on comparative
information for one or more prior periods presented, the Departmental Group will restate the opening
balances of assets, liabilities and equity for the earliest period for which retrospective restatement is
practicable.
The option to adopt retrospectively has been removed by the FReM for IFRS 9 ‘Financial Instruments’
and IFRS 15 ‘Revenue from Contracts with Customers’, therefore, there was no restatement of
31 March 2018 comparatives made for the adoption of the new accounting standards in 2018-19.
There is a restatement in 2019-20 in relation to adjustments to the adoption of IFRS 9 and
adjustments to the Departmental Group’s prior period Outturn. The prior period adjustments and their
impact on the comparative amounts for the prior periods represented in which the error occurred are
detailed in note 26.

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Annual report and accounts 2019-20
2. Reporting by operating segment
In accordance with the relevant reporting requirements, including IFRS 8 – Operating Segments,
the Statement of Parliamentary Supply (SoPS) and supporting notes reflect net resource and capital
Outturn in line with the control totals voted by Parliament. The figures within SoPS 1.1 provide the
income and expenditure totals associated with key business activities within the Departmental Group
and therefore reflect the management information reporting to the Board during the period.
3. Staff costs
Staff costs comprise:
2019-20
2018-19
Permanently
employed
staff
Others
Total
Total
£m
£m
£m
£m
Wages and salaries
855
73
928
855
Social security costs
95
–
95
86
Other pension costs
217
–
217
179
Sub total
1,167
73
1,240
1,120
Less recoveries in respect of outward secondments
–
–
–
(1)
Total net costs
1,167
73
1,240
1,119
Of which:
Core Department and Agencies
372
18
390
330
NDPBs and other designated bodies
795
55
850
789
Total net costs
1,167
73
1,240
1,119
For further information on staff costs and numbers, please see the Staff Report and the Remuneration
Report which includes staff costs for nuclear site licence companies (SLC’s) which are not included in
the table above. SLC’s staff costs are not included in the table above as they are included in the
amount shown for utilisation in the NDA’s nuclear decommissioning provision in note 18.

143
Financial Statements
4. Operating expenditure
4.1 Purchase of goods and services
2019-20
2018-19 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Rentals under operating leases
44
57
30
47
Accommodation and office equipment costs
16
212
42
218
Legal, professional and consultancy costs
159
342
142
288
Finance, HR, IT and support costs
151
170
110
127
Training and other staff costs
8
23
10
28
Travel and subsistence costs
11
52
11
55
Advertising and publicity
6
16
3
18
Programme management and administration of
grants and awards
39
179
40
175
Capacity Market payments
–
1,483
–
176
Professional and international subscriptions
365
612
283
516
Enforcement costs of employment related policies
30
30
30
30
Donations
–
21
–
16
Funding Paternity, Adoption and Shared Parental
Leave policy
72
72
79
79
Purchase of geographical and scientific equipment
–
40
–
46
Purchase of weather information and weather related
services
101
101
108
108
Redundancy payments service
430
430
320
320
Sponsorship costs
–
–
2
3
Payment of taxes and levies
–
2
–
168
Subsidy to Post Office Limited
50
50
62
62
Energy intensive industries subsidies
105
105
141
141
Other purchase of goods and services cost
10
304
11
321
Total
1,597
4,301
1,424
2,942
Purchase of goods and services
Purchase of goods and services – Legal, professional and consultancy services has been restated,
see note 26 for further details.
Audit fees
Audit fees are included under the heading ‘Legal, professional and consultancy costs’.
Core Department
During the year the Core Department did not purchase any non-audit services from its auditor, the
National Audit Office. The non-cash auditors’ remuneration of £700,000 (2018-19: £625,570)
comprises £640,000 (2018-19: £570,000) for the cost of the audit of the Departmental Group,
£20,000 (2018-19: £20,000) for the Trust Statement, and £40,000 (2018-19: £35,750) for the audit
of the UK Atomic Energy Authority Pension Scheme Accounts.
Agencies
During the year the Agencies did not purchase any non-audit services from their auditor, the National
Audit Office. Details of the non-cash auditors’ remuneration of £167,000 (2018-19: £152,000) can be
found in the accounts of the individual Agencies.

144
Annual report and accounts 2019-20
NDPBs and other designated bodies
The cash remuneration of £2,787,121 (2018-19: £2,287,880) relates to the statutory audit of NDPBs
and other designated bodies and includes fees of £191,000 relating to the 2018-19 audits. Of this
amount, £2,299,250 (2018-19: £1,955,291) was payable to the NAO and £487,871 (2018-19:
£332,589) was payable to auditors other than the NAO.
In 2019-20, £nil was payable to the NAO (2018-19: £nil) and £240,267 was payable to auditors other
than the NAO (2018-19: £127,546) for non-audit services. Further details can be obtained from the
accounts of the NDPBs and other designated bodies.
Redundancy Payments Service
INSS, an Agency of the Department, is responsible for the approval and processing of claims under
the Redundancy Payment Service (RPS), which is financed from the National Insurance Fund.
Redundancy payments are made from the National Insurance Fund to employees whose employers
have failed to make payments due or who were insolvent.
The Insolvency Service has a service level agreement with HM Revenue and Customs.
Claims processed fall into two categories:
• RP1 (which covers redundancy pay, holiday pay and arrears of pay).
• RP2 (pay in lieu of notice).
There is associated income arising from two sources:
• Solvent Recovery – where money is recovered from solvent employers to meet the costs of
redundancy payments made by the RPS.
• Insolvent Recovery – INSS becomes a creditor receiving a dividend if there are sufficient funds in
the insolvency of the employer.
Expenditure in respect of RPS in 2019-20 totalled £496 million (2018-19: £320 million) against income
of £66 million (2018-19: £nil million). The net amount totalled £430 million (2018-19: £320 million).
Payments of taxes and levies
During 2018-19, UK Research and Innovation (UKRI) was required to pay corporation tax on the
chargeable gain arising on the transfer of assets from the predecessor Research Councils into UKRI.
The total value of this payment was £143 million. This was a one-off transaction in 2018-19.
Capacity market payments
Capacity payment expenses for the 2018/19 Delivery Year have been recognised in 2019-20 due to
the suspension of the Capacity Market in 2018-19 (see note 1.26).
4.2 Depreciation and impairment charges
2019-20
2018-19
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Amortisation of recoverable contract costs
–
101
–
166
Depreciation
21
231
18
256
Amortisation
3
65
2
45
Impairment of property, plant and equipment
4
26
2
59
Impairment of investments and remeasurement of
expected credit losses
(10)
17
26
74
Total
18
440
48
600

145
Financial Statements
4.3 Provision expense
2019-20
2018-19
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Increase/(decrease) in nuclear provisions due to
changes in discount rate
20
247
(37)
(95,984)
Increase/(decrease) in other provisions due to
changes in discount rate
7
(20)
(127)
(2,799)
Other provision movements relating to Small
Business Grant Fund and Retail, Hospitality and
Leisure Grant Fund
10,824
10,824
–
–
Other provision movements excluding bad debt
provisions and financial guarantee liabilities
(21)
6,812
210
1,057
Total increase/(decrease) in provisions
excluding bad debt provisions and financial
guarantee liabilities
10,830
17,863
46
(97,726)
Total increase/(decrease) in bad debt provisions
–
–
1
1
Total increase/(decrease) in financial guarantee
liabilities and loan commitment liabilities
39
10
12
4
Total
10,869
17,873
59
(97,721)
Included in the table above is a provision relating to COVID-19 Grant Funding. The Core Department
has recognised a provision relating to the Small Business Grant Fund and the Retail, Hospitality and
Leisure Grant Fund which was announced by the Chancellor on 11 March 2020 due to the COVID-19
pandemic. The provision has been recognised for claims that were not paid by local authorities to
eligible businesses at 31 March 2020, but which are reasonably expected to be claimed during
2020-21
The provision expense in 2019-20 was primarily driven by cost estimate changes of the NDA’s nuclear
decommissioning provision which increased the nuclear decommission liability estimate by
£6.9 billion. The significant provision expense in 2018-19 was primarily driven by the reduction in
discount rates for cash outflows expected after ten year from an equivalent real discount rate of
prescribed by HM Treasury applied in 2017-18 of (1.56%) to an equivalent real discount rate
prescribed by HM Treasury applied in 2018-19 of (0.11%). In 2019-20, the equivalent real discount
rate for cash outflows expected after ten prescribed by HM Treasury has reduced to (0.01%), which
had a less significant impact on the 2019-20 provision expense. Further detail of the movements in
provisions can be found in note 18.1 for Nuclear provisions and note 18.2 for Other provisions.

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Annual report and accounts 2019-20
4.4 Grants
2019-20
2018-19
represented
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Grant in aid
11,308
–
10,978
–
Post Office network reform
42
42
168
168
Market frameworks
67
67
66
66
Science and research
521
6,730
486
6,342
International Climate Fund
291
297
244
247
Renewable Heat Incentive
846
846
818
818
Innovation programmes
125
610
113
596
Heat Infrastructure Team
29
29
2
2
Small Business Grant Fund and Retail, Hospitality
and Leisure Grant Fund
151
151
–
–
Resource grants to central government bodies
588
588
–
–
Other grants
38
50
32
41
Total
14,006
9,410
12,907
8,280
The allocation of grants between categories in the table above has been represented for 2018-19
based on the revised disclosure for 2019-20. This is solely a disclosure adjustment as the total grants
were correctly reported in the BEIS 2018-19 Annual Report and Accounts.
Core Department
On 22 May 2019, British Steel Limited filed for compulsory liquidation. The court appointed Official
Receiver took control of the company and, with the assistance of the EY Special Managers, was
responsible for running an independent sales process. Owing to the difficulty and expense of the
liquidation of a steel manufacturer, and the risk of personal liability arising from the operation of an
insolvency involving a steel installation, the Official Receiver requested and was granted an indemnity
from the Government.
The indemnity was given in respect of claims, proceedings, costs and expenses arising in the ordinary
course of the Official Receiver’s statutory functions as liquidator of the company. In providing the
Official Receiver with an indemnity the Government enabled the Official Receiver to discharge his
statutory duties through continuing to trade the business while undertaking an independent sales
process during which a buyer was ultimately secured.
The total funding paid to the Official Receiver in the year to 31 March 2020 was £588 million and is
shown in the above note. The funding was voted through the Supplementary Estimates laid before
Parliament on 12 February 2020. On 9 March 2020, the sale of British Steel Limited to the Chinese
Steelmaker Jingye Group was completed by the Official Receiver. During the financial year 2020-21
there will continue to be funding provided to the Official Receiver to complete the wind up of British
Steel Ltd including assets not purchased by Jingye. The total cost of the liquidation will fluctuate until
the liquidation accounts are finalised.
In April 2019 HMG entered into a commercial agreement with British Steel to allow it to meet its EU
ETS obligations. Under a Deed of Forfeiture HMG bought £119 million of EU ETS allowances to meet
British Steel’s 2018 EU ETS liability. In return, the Core Department received all 5.6 million of British
Steel’s 2019 free allocation of ETS allowances when allocated in February 2020, which are included
within intangible assets in note 8.

147
Financial Statements
5. Finance expense
2019-20
2018-19
restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Change in fair value – financial assets
(113)
50
(214)
(150)
Net loss/(gain) on foreign exchange
–
(1)
–
2
Unrealised foreign exchange rate losses
1
1
2
2
Bank charges
–
–
–
1
Interest payable
–
36
–
33
Expected return on funded pension scheme assets
–
(39)
–
(41)
Interest on pension liabilities
–
38
–
38
Borrowing costs on provisions
(13)
(103)
(37)
(3,660)
Total
(125)
(18)
(249)
(3,775)
Finance expense – Changes in fair value – financial assets and Unrealised foreign exchange rate
losses have been restated, see note 26 for further details.
In 2018-19 and 2019-20, the HM Treasury prescribed nominal and inflation rates were positive.
However, the resulting real discount rates remained negative in 2018-19 and 2019-20, leading to
a negative expense for borrowing costs on provisions. The borrowing costs on provision negative
expense is primarily driven by the unwind of the discount on the NDA’s nuclear decommissioning
provision. The 2019-20 equivalent real discount rate for cash outflows expected after ten prescribed
by HM Treasury has reduced to (0.01%) from (0.11%) in 2018-19, this has resulted in a reduction in
the borrowing cost negative expense on the nuclear decommissioning provision. Further detail of the
movements in provisions can be found in note 18.1 for Nuclear provisions and note 18.2 for Other
provisions.
6. Income
6.1 Operating income
2019-20
2018-19
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Income from sales of goods and services:
Income from contracts with customers
Fees, charges and recharges to/from external
customers and central Government organisations
148
317
139
250
Levy income
11
3,347
10
1,212
Sales of goods and services
10
804
11
936
Miscellaneous income
6
82
8
99
Other income
European Union funding
1
20
4
26
Current grants and capital grants
81
228
102
262
Coal pension receipts
–
–
475
475
Total
257
4,798
749
3,260
In 2018-19, income of £475 million in relation to the final sum receivable from the September 2017
valuation of the Mineworkers’ Pension Scheme was recognised. Further cash was received in
2019‑20 which is reducing the Coal Pension receivables disclosed in note 14.

148
Annual report and accounts 2019-20
Capacity Market supplier charge income relating to the 2018/19 Delivery Year has been recognised in
Levy Income in 2019-20 due to the suspension of the Capacity Market in 2018-19. £1,483 million of
Capacity Market supplier charge income has been recognised in 2019-20 (2018-19: £176 million)
(see note 1.26).
Included in the sales of goods and services line above is £703 million of income from the NDA
(2018‑19: £828 million) relating to contract income under IFRS 15. The most significant contracts
of the Departmental Group are held by the NDA. The table below shows the main types of contract,
the main areas of performance obligations therein, and for each category:
• the revenue recognised in the reporting period [A]
• the revenue expected to be recognised in future reporting periods (being the aggregate amount
allocation to performance obligations that are wholly or partially unsatisfied at the reporting date) [B]
• an indication of when NDA expects to recognise the remaining contract price
Contract type
Categories of performance
obligation
[A]
£m
[B]
£m
Of which £m:
2020-
2025
2026-
2038
2039-
2087
Spent fuel reprocessing and associated
waste management
Spent fuel storage
12
710
53
138
519
Interim storage wastes
85
419
419
0
0
Treatment of wastes
64
314
314
0
0
Storage of treated wastes
4
172
20
52
100
Storage of products
19
840
84
219
537
Spent fuel receipts
Receipt of spent fuel
215
4,076
1,644
2,432
0
Other storage contracts
Storage of materials
67
1,087
299
579
209
Storage and destorage of residues
Storage
4
10
10
0
0
Destorage
1
24
21
3
0
Waste substitution
Destorage
0
72
47
25
0
Legacy waste management
Waste management
6
171
171
0
0
Transfer of ownership of materials and flasks
166
0
0
0
0
Total
643
7,895
3,082
3,448
1,365
The remaining revenue to be recognised in future reporting periods comprises:
• Payments from customers made on account
• Expected remaining future payments from customers
6.2 Finance income
2019-20
2018-19
restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Effective Interest for FVTPL assets
25
25
30
30
Effective Interest for amortised cost assets
29
29
36
36
Interest income for amortised cost assets
10
84
10
74
Interest income for FVTPL assets
10
54
7
63
Dividend income for FVTPL assets held at the
period end
–
97
–
122
Dividend income from investments in joint ventures,
associates and public dividend capital
138
45
131
45
Total
212
334
214
370

149
Financial Statements
Core Department
In 2019-20 the Core Department recognised dividend income of £138 million (2018-19: £131 million).
This includes a dividend of £94 million from Enrichment Holdings Limited (EHL) (2018-19: £87 million),
which is eliminated on consolidation. In the Departmental Group accounts, EHL is consolidated and
its investment in URENCO is recognised as an associate. The Department recognises its share of
URENCO’s profit for the year in Other operating expenditure and a fair value movement in Other
Comprehensive Income.
Departmental Group
In 2019-20 the Departmental Group received dividend income of £142 million (2018-19: £168 million
restated), comprising distributions from investment funds and dividend income of £90 million
(2018‑19: £119 million restated) recognised from BIS (Postal Services Act 2011) Company.
See note 26 for further details.

150
Annual report and accounts 2019-20
7. Property, plant and equipment
Land
Buildings
Dwellings
Leasehold
Improvements
Information
Technology
Plant and
Machinery
Furniture,
Fixtures and
Fittings
Transport
Equipment
Assets under
Construction
Total
Departmental Group 2019-20
£m
£m
£m
£m
£m
£m
£m
£m
£m
£m
Cost or valuation
Balance at 1 April 2019
243
2,471
41
56
257
6,204
22
328
582
10,204
Additions
–
7
–
1
11
43
3
4
226
295
Disposals
–
(3)
–
(1)
(53)
(127)
(1)
(65)
(7)
(257)
Impairments
–
–
–
–
–
(14)
–
–
(9)
(23)
Transfers in/(out) of boundary
10
–
–
–
–
–
–
–
(2)
8
Reclassifications
4
87
–
15
19
36
2
10
(173)
–
Revaluations
14
18
1
–
–
19
–
9
19
80
At 31 March 2020
271
2,580
42
71
234
6,161
26
286
636
10,307
Depreciation
Balance at 1 April 2019
(7)
(1,000)
–
(32)
(191)
(5,207)
(13)
(221)
–
(6,671)
Charged in year
(1)
(49)
(1)
(5)
(29)
(132)
(2)
(12)
–
(231)
Disposals
–
2
–
1
51
107
1
64
–
226
Impairments
–
–
–
–
(3)
–
–
–
–
(3)
Reclassifications
(22)
22
–
–
–
3
–
(3)
–
–
Revaluations
2
(10)
1
–
–
(11)
–
(5)
–
(23)
At 31 March 2020
(28)
(1,035)
–
(36)
(172)
(5,240)
(14)
(177)
–
(6,702)
Carrying amount at 31 March 2020
243
1,545
42
35
62
921
12
109
636
3,605
Carrying amount at 1 April 2019
236
1,471
41
24
66
997
9
107
582
3,533
Asset financing:
Owned
190
1,527
42
35
61
921
12
109
636
3,533
Finance leased
53
18
–
–
–
–
–
–
–
71
On balance sheet (SoFP) PFI and other
service concession arrangements
–
–
–
–
1
–
–
–
–
1
Carrying amount at 31 March 2020
243
1,545
42
35
62
921
12
109
636
3,605
Of the total:
Core Department and Agencies
18
110
–
30
9
78
5
–
56
306
NDPBs and other designated bodies
225
1,435
42
5
53
843
7
109
580
3,299
Carrying amount at 31 March 2020
243
1,545
42
35
62
921
12
109
636
3,605

151
Financial Statements
Land
Buildings
Dwellings
Leasehold
Improvements
Information
Technology
Plant and
Machinery
Furniture,
Fixtures and
Fittings
Transport
Equipment
Assets under
Construction
Total
Departmental Group 2018-19
£m
£m
£m
£m
£m
£m
£m
£m
£m
£m
Cost or valuation
Balance at 1 April 2018
303
4,055
40
74
232
6,208
18
324
506
11,760
Additions
4
2
–
2
6
32
4
4
258
312
Disposals
–
(1,842)
–
(13)
(8)
(122)
(1)
(2)
–
(1,988)
Impairments
(41)
(7)
–
–
–
3
–
(6)
–
(51)
Transfers in/(out) of boundary
–
(4)
–
(12)
(2)
–
–
–
3
(15)
Reclassifications
–
71
–
5
28
73
1
5
(195)
(12)
Revaluations
(23)
196
1
–
1
10
–
3
10
198
At 31 March 2019
243
2,471
41
56
257
6,204
22
328
582
10,204
Depreciation
Balance at 1 April 2018
–
(2,749)
–
(42)
(171)
(5,177)
(12)
(195)
–
(8,346)
Charged in year
–
(56)
(1)
(7)
(29)
(142)
(2)
(19)
–
(256)
Disposals
–
1,839
–
13
8
121
1
2
–
1,984
Impairments
–
–
–
(1)
–
(7)
–
–
–
(8)
Transfers (in)/out of the boundary
–
–
–
5
1
–
–
–
–
6
Reclassifications
–
–
–
–
–
1
–
(1)
–
–
Revaluations
(7)
(34)
1
–
–
(3)
–
(8)
–
(51)
At 31 March 2019
(7)
(1,000)
–
(32)
(191)
(5,207)
(13)
(221)
–
(6,671)
Carrying amount at 31 March 2019
236
1,471
41
24
66
997
9
107
582
3,533
Carrying amount at 1 April 2018
303
1,306
40
32
61
1,031
6
129
506
3,414
Asset financing:
Owned
211
1,471
41
24
64
997
9
107
582
3,506
Finance leased
25
–
–
–
–
–
–
–
–
25
On balance sheet (SoFP) PFI and other
service concession arrangements
–
–
–
–
2
–
–
–
–
2
Carrying amount at 31 March 2019
236
1,471
41
24
66
997
9
107
582
3,533
Of the total:
Core Department and Agencies
18
98
–
20
5
81
2
–
70
294
NDPBs and other designated bodies
218
1,373
41
4
61
916
7
107
512
3,239
Carrying amount at 31 March 2019
236
1,471
41
24
66
997
9
107
582
3,533

152
Annual report and accounts 2019-20
Property, plant, and equipment (PPE) held by the Departmental Group
The professional valuations of land and buildings undertaken within the Departmental Group were
prepared in accordance with the Royal Institute of Chartered Surveyors (RICS) Valuation Standards
(6th Edition), the ‘Red Book’. Unless otherwise stated, land and buildings are professionally revalued
every five years and where appropriate in the intervening period, relevant indices are used. The most
significant land and buildings at 31 March 2020 were held by Nuclear Decommissioning Authority
(NDA) and UK Research and Innovation (UKRI).
In accordance with the FReM the majority of Leasehold improvements, Information Technology,
Furniture, Fixtures and Fittings and Plant and Machinery are held at depreciated historic cost as a
proxy for fair value as the assets have short useful lives or low values. Land, Freehold Buildings,
Dwellings, Transport Equipment and the remainder of Plant and Machinery are held at fair value based
on professional valuations.
Within the Departmental Group, a variety of valuation techniques are used depending upon whether
the PPE asset is a specialised asset or a non-specialised asset. Where the PPE asset is a specialised
asset, then a depreciated replacement cost valuation is used, for example by scientific institutes.
Where the PPE asset is a non-specialised asset, then an existing-use valuation is used, for example
for land and office buildings. Depreciated replacement cost (DRC) valuations are based on a number
of unobservable inputs; these would be classified as level 3 in accordance with IFRS 13. Existing-use
value (EUV) valuations are based on a number of market corroborated but unobservable inputs
e.g. land valuations are based on similar prices per hectare adjusted for the specific location of the
land, whilst other EUV valuations use specific unobservable inputs, e.g. rental yields. The EUV
valuations inputs are classified as level 2 and level 3 in accordance with IFRS 13.
The Departmental Group does not hold any material individual PPE assets. Therefore there are no
individually material level 3 assumptions included in the overall Departmental Group fair value of PPE.
For there to be a material movement in the fair value of PPE, this would require a significant increase
in a number of level 3 valuation assumptions across the Departmental Group.
The most significant valuations in the Departmental Group relate to land and buildings held by UKRI.
Due to the COVID-19 pandemic and resulting lockdown, with consequential impacts on the economy,
it is anticipated that there will be an effect on the indices used by UKRI to revalue their land and
buildings in between professional valuations.
UKRI have estimated the potential financial impact of changes to those indices that are available as
close to the year end as possible. The results all indicate some reduction in asset value ranging from
1.5% to the extreme case removing all upward revaluations recognised by UKRI in the year. This
results in a potential movement of between £19.5 million and £52.4 million. Due to the unclear
reliability of indices over the period and the coming months, and UKRI management’s view that any
fall in values for their land and buildings is likely to be temporary, current valuations have been
maintained and not adjusted for any uncertain potential reduction.
Further information can be found in the financial statements of the individual bodies’ accounts.

153
Financial Statements
8. Intangible assets
Departmental Group
2019-20
Information
Technology
Software
Licences
Websites
Patents
Licences &
Others
Assets under
Construction
Total
£m
£m
£m
£m
£m
£m
£m
Cost or Valuation
Balance at 1 April 2019
157
97
1
318
–
24
597
Additions
5
19
–
–
119
7
150
Disposals
(10)
(7)
–
–
–
(2)
(19)
Impairments
–
(1)
–
–
–
–
(1)
Reclassifications
(51)
61
–
–
–
(10)
–
Transfers in/(out)
4
–
–
–
–
(4)
–
Revaluations
–
–
–
13
(32)
–
(19)
At 31 March 2020
105
169
1
331
87
15
708
Amortisation
Balance at 1 April 2019
(127)
(54)
(1)
(248)
–
–
(430)
Charged in year
(16)
(35)
–
(14)
–
–
(65)
Disposals
10
7
–
–
–
–
17
Reclassifications
59
(59)
–
–
–
–
–
At 31 March 2020
(74)
(141)
(1)
(262)
–
–
(478)
Carrying amount at
31 March 2020
31
28
–
69
87
15
230
Carrying amount at
1 April 2019
30
43
–
70
–
24
167
Asset financing:
Owned
31
28
–
69
87
15
230
Carrying amount at
31 March 2020
31
28
–
69
87
15
230
Of the total:
Core Department and
Agencies
3
2
–
–
87
9
101
NDPBs and other
designated bodies
28
26
–
69
–
6
129
Carrying amount at
31 March 2020
31
28
–
69
87
15
230

154
Annual report and accounts 2019-20
Departmental Group
2018-19
Information
Technology
Software
Licences
Websites
Patents
Licences &
Others
Assets under
Construction
Total
£m
£m
£m
£m
£m
£m
£m
Cost or Valuation
At 1 April 2018
152
72
1
297
–
7
529
Additions
2
1
–
–
–
33
36
Disposals
–
(2)
–
–
–
–
(2)
Reclassifications
1
24
–
–
–
(13)
12
Transfers in/(out)
2
2
–
–
–
(3)
1
Revaluations
–
–
–
21
–
–
21
At 31 March 2019
157
97
1
318
–
24
597
Amortisation
At 1 April 2018
(114)
(34)
(1)
(235)
–
–
(384)
Charged in year
(13)
(19)
–
(13)
–
–
(45)
Disposals
–
1
–
–
–
–
1
Transfers in/(out)
–
(2)
–
–
–
–
(2)
At 31 March 2019
(127)
(54)
(1)
(248)
–
–
(430)
Carrying amount at
31 March 2019
30
43
–
70
–
24
167
Carrying amount at
1 April 2018
38
38
–
62
–
7
145
Asset financing:
Owned
30
43
–
70
–
24
167
Carrying amount at
31 March 2019
30
43
–
70
–
24
167
Of the total:
Core Department and
Agencies
4
2
–
–
–
8
14
NDPBs and other
designated bodies
26
41
–
70
–
16
153
Carrying amount at
31 March 2019
30
43
–
70
–
24
167
All software licenses are acquired separately.
All Information Technology (IT) assets are internally generated. IT assets are initially classified as assets
under construction and are not amortised until they are commissioned, at which time they are
re‑classified as IT.
Core Department
In April 2019 HMG entered into a commercial agreement with British Steel to allow it to meet its EU
ETS obligations. Under a Deed of Forfeiture HMG bought £119 million of EU ETS allowances to meet
British Steel’s 2018 EU ETS liability. In return, the Core Department received all 5.6 million of British
Steel’s 2019 free allocation of ETS allowances when allocated in February 2020, which are included
within intangible assets.
Departmental Group
The Departmental Group holds its intangible assets at valuation. In accordance with the FReM,
the Departmental Group adopts cost less amortisation as a proxy for fair value as the intangible
assets have short lives. The exception to this is patents which are held at fair value based on a
valuation model.

155
Financial Statements
The model uses a variety of assumptions to estimate the value of future income streams from the
patents to determine the fair value; these include an estimate for future royalty income derived from
the consensus forecast data from industry specialists, which are adjusted for expected future USD/
GBP exchange rates, the territories in which the patents are applicable and potential threats to future
income (such as competitor products and regulatory approval). In accordance with IFRS 13, these
assumptions would be classed as level 3 assumptions. The carrying amount of the patents at
31 March 2020 is £69 million (2018-19: £70 million) and there would need to be a substantial increase
in expected royalty income to result in a material increase in the fair value of the patents.
9. Derivative financial instruments
The most significant items included within Derivatives on the Consolidated Statement of Financial
Position (SoFP) are the Contracts for Difference (CfDs).
CfDs
CfDs are a mechanism used to support investment in UK low carbon generation projects. CfDs have
been established as a contract between the ‘Generator’ and the Low Carbon Contracts Company Ltd
(LCCC), a company wholly owned by the Government and consolidated within the Department’s
accounts.
CfDs have been classified as derivatives in accordance with IFRS 9 ‘Financial Instruments’ and
recognised at their ‘fair value’ by deferring the difference between fair value and transaction price at
initial recognition. Any subsequent gain or loss in fair value is recognised in the Statement of
Comprehensive Net Expenditure.
The fair value of any derivative is assessed by reference to IFRS 13 ‘Fair Value Measurement’, which
provides three options for assessment. Fundamentally the value should always reference an open
market place but where no market place exists, an option is available for internally generated fair
value. The different options are hierarchical and classed as Level 1, 2, or 3 inputs, where Level 1 is
based on market prices, Level 2 is based on observable data other than market prices and Level 3 is
used where Level 1 or 2 data is unavailable.
The fair value of the Department’s CfDs has been calculated using the income approach based on
Level 3 inputs, which reflects the present value (PV) of future cash flows that are expected to occur
over the contract term of the CfD. The discount rate which has been used to determine the PV for
financial reporting is the Financial Instrument real rate of 0.7% set by HM Treasury Public Expenditure
System (PES) Secretariat on 6 December 2019.
By contrast, for investment decisions and project appraisal, the Department is required to use the
social discount rate of 3.5% published in HM Treasury’s Green Book. As the cash flows from Hinkley
Point C (HPC) CfD are expected to occur over a 35 year period from 2025 to 2060, the valuation for
financial reporting based on the 0.7% discount rate will be significantly higher than the economic
valuation based on the 3.5% discount rate, even where all other inputs are the same.
The deferred difference between the fair value of the liability on day one and the transaction price is
amortised over the contract life of the CfDs, which commences from the earlier of i) the actual start
date of generation or ii) the end of the Target Commissioning Window (TCW) identified in the CfD,
as this is the point at which the contractual liability will start to unwind (i.e. it is the point at which the
potential payment period under the CfD commences).
The significance of these two dates is that they are the part of the contractual provisions which
determine when the right to potential CfD payments starts. The contract payment period is typically
for 15 years, but specific exceptions exist:
• for contracts relating to biomass conversion which have an expiration date in 2027;
• the contract for HPC nuclear generating plant which will expire at the earlier of 35 years after the
start date of the second reactor or when the total CfD payments made have reached the
Generation Cap (i.e. 910,000,000 MWh).

156
Annual report and accounts 2019-20
CfDs may be signed many years in advance of actual generation. The main benefit to generators is
the fact that they can derive economic benefit from these contracts across the payment period life of
the contract and the added certainty which the CfD contract provides helps them to finance the
project.
Under the legislation, there is an obligation placed on licensed electricity suppliers to fund the CfD
liabilities as they crystallise through the Supplier Obligation Levy. The future levy amounts which will be
received from the licensed suppliers will be accounted for within LCCC and will be triggered by the
generation and supply of low carbon electricity.
As at 31 March 2020 LCCC was counterparty to 73 contracts recognised in the accounts, including
HPC and 22 CfD contracts signed in the year after the Allocation Round 3 (AR3) (at 31 March 2019:
53 contracts). During the year LCCC recognised the HPC CfD in the financial statements, as
historically it was not recognised in the Statement of Financial Position.
Measurement differences relating to day one recognition
All CfDs (including Hinkley Point C) are issued for £nil consideration through the CfD auction process,
this being deemed the transaction price. The transaction price for CfDs differs from the fair value at
initial recognition measured using a valuation model, mainly because the transaction price is not
established in an active market. If there are significant unobservable inputs used in the valuation
technique (Level 3), the financial instrument is recognised at the transaction price and any difference
between the transaction price and fair value at initial recognition measured using a valuation model
is deferred.
A single point valuation has been used for the recognition of HPC and AR3 CfDs, as the valuation as
at 31 March 2020 is considered a reasonable proxy for the day one recognition. Therefore, in line with
other CfDs, the measurement difference, being the difference between the transaction price and fair
value of HPC and AR3 CfDs as at 31 March 2020, has been deferred.
The following table represents the difference between the CfD liability at initial recognition and at the
reporting date:
Core
Department
and Agencies
LCCC CfDs
(exc. HPC)
LCCC HPC
Departmental
Group Total

£m
£m
£m
£m
CfD liability as at 31 March 2018 recognised on
the Consolidated Statement of Financial Position
–
15,892
–
15,892
Re-measurement of the CfD liability
–
(2,743)
–
(2,743)
Release of liability relating to terminated contracts
–
39
–
39
Payments to the CfD generators
–
(980)
–
(980)
Deferred difference recognised during the year
–
713
–
713
CfD liability as at 31 March 2019 recognised on
the Consolidated Statement of Financial
Position
–
12,921
–
12,921
Other non-CfD liabilities as at 31 March 2019
2
–
–
2
Carrying value of non-current derivative
liabilities as at 31 March 2019
2
12,921
–
12,923
Remeasurement of the CfD liability
–
4,406
–
4,406
Payments to the CfD generators
–
(1,803)
–
(1,803)
Deferred difference recognised during the year
–
940
–
940
CfD liability as at 31 March 2020 recognised on
the Consolidated Statement of Financial Position
–
16,464
–
16,464
Other non-CfD liabilities as at 31 March 2020
–
–
–
–
Carrying value of non-current derivative
liabilities as at 31 March 2020
–
16,464
–
16,464
During the year, the net movement of £5,346 million (2018-19: (£1,991 million)) in the fair value of
CfDs is recognised in the Statement of Comprehensive Net Expenditure.

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Financial Statements
Movement in deferred measurement differences
The following table shows the movement in deferred day one loss.
Core
Department
and Agencies
LCCC CfDs
exc. HPC
LCCC HPC
Departmental
Group Total

£m
£m
£m
£m
Deferred measurement differences as at
31 March 2018
–
23,309
–
23,309
Measurement differences recognised in respect of
terminated CfDs
–
(268)
–
(268)
Deferred measurement differences recognised
during the year
–
(713)
–
(713)
Deferred measurement differences as at
31 March 2019
–
22,328
–
22,328
Measurement differences deferred during the year
–
905
50,826
51,731
Deferred measurement differences recognised
during the year
–
(940)
–
(940)
Deferred measurement differences as at
31 March 2020
–
22,293
50,826
73,119
Fair value measurement of CfDs
The fair value of CfDs represents the LCCC’s best estimate of the payments which the LCCC will be
committed to make, if and when the generators supply low carbon electricity in accordance with their
contractual terms. They are based upon the estimates of future electricity prices to forecast the
potential liabilities using the Dynamic Dispatch Model (DDM) owned by the Department.
Should no low carbon electricity be supplied in accordance with the contractual terms, then the LCCC
is not under any obligation to make these payments.
Fair value of CfDs (financial liabilities at fair value through profit
and loss)
The following table provides an analysis of financial instruments which are measured subsequent to
initial recognition at fair value and grouped into input levels 1 to 3 within the fair value hierarchy based
on the degree to which the fair value is observable:
Level 1
Level 2
Level 3
Total

£m
£m
£m
£m
Balance at 31 March 2019
–
–
35,249
35,249
Balance at 31 March 2020
–
–
89,583
89,583
Comparative values in the table above exclude the liability for Hinkley Point C CfD as this CfD was
recognised in the current year. In the current year the fair value attributable to Hinkley Point C CfD is
£50.8 billion.
Reconciliation of CfDs
The following table shows the impact of the fair value of all CfDs which have been recognised in these
accounts, classified under level 3, by using the assumptions described below (all held by LCCC):

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Annual report and accounts 2019-20
LCCC CfDs
exc. HPC
LCCC HPC
Departmental
Group Total

£m
£m
£m
Balance at 31 March 2018
39,201
–
39,201
Change in fair value during the year
(2,743)
–
(2,743)
CfDs terminated during the year
(229)
–
(229)
Payments to the CfD generators
(980)
–
(980)
Balance at 31 March 2019
35,249
–
35,249
Recognition of Hinkley Point C CfD during the year
–
50,826
50,826
Additions during the year
905
–
905
Change in fair value during the year
4,406
–
4,406
Payments to the CfD generators
(1,803)
–
(1,803)
Balance at 31 March 2020
38,757
50,826
89,583
Key inputs and underlying assumptions for CfDs
For the key inputs into the model, the underlying assumptions are set out below.
Estimated future forecast wholesale electricity prices
Forecast wholesale electricity prices used to estimate the fair value of CfDs are derived from the
DDM which has been developed by the Department to facilitate/inform policy decisions by modelling
investor behaviour in response to fuel and carbon prices and policy environment. The DDM estimates
the wholesale price by:
• calculating the short run marginal cost (SRMC) of each plant (including a representation of plants in
interconnected markets), taking account of start-up and shut-down costs
• calculating the available output of intermittent renewables
• calculating the half hourly demand for electricity by taking into account demand side response
• determining the marginal plant required to meet demand
Economic, climate, policy, generation and demand assumptions are external inputs to the model
including demand load curves for both business and non-business days and seasonal impacts.
Specific assumptions can also be modelled for domestic and non-domestic sectors and smart
meter usage.
The forecast trajectory of electricity prices is uncertain. In the valuation, LCCC’s management has
used the DDM reference case to calculate the fair value and the impact of low and high cases have
been disclosed within sensitivities. Low and high cases have also been published by the Department
and are based on the Department’s fossil fuel price assumptions for 2019, which presents low and
high assumptions for the wholesale prices of oil, gas and coal.
In the valuation, the wholesale price has been reduced to reflect the price the wind generator is likely
to receive. Additionally, wholesale electricity forward prices have been used for the liquid trading
horizon (covering the nearest 2 years period). On windy days, the price that wind generators receive is
likely to be reduced. The effect of reduced prices for wind generation adds approximately £2.3 billion
to the valuation.
Estimated future wholesale electricity generation
a. Transmission Loss Multiplier (TLM)
TLM reflects the fact that electricity is lost as it passes through the transmission system from
generators to suppliers. If the TLM is incorrect, this will have implications for the volume of electricity
subject to CfD payments. Any change in TLM will be corrected through adjustments in strike prices
although the change in TLM is expected to be immaterial.

159
Financial Statements
b. Start date
Generators nominate a Target Commissioning Date (TCD) in their binding application form for a CfD,
and this date is specified in their CfD following contract award. However, the generator is free to
commission at any time within their Target Commissioning Window (TCW), a period of one year from
the start of the TCW for most technologies, with no penalty, or after the end of the TCW and up to
their ‘Longstop Date’ (one to two years after the end of the TCW depending on technology) with a
penalty in the form of reduction of contract length for each day they are late in commissioning after
the end of the TCW. The contract can be terminated if the generator has not commissioned 95%
(or 85% for Investment Contracts and offshore wind) of their revised installed capacity estimate by the
end of the Longstop Date. The valuation uses the latest estimate from generators on the start date.
The Target Commissioning Dates for reactor one and reactor two of the Hinkley Point C project are 1
December 2025 and 1 June 2026 respectively. The TCW for reactor one is 1 May 2025 to 30 April
2029. The TCW for reactor two is 1 November 2025 to 31 October 2029. Any change to the start
date will change the timing of future cash flows and impact on the discounted fair value.
c. Installed capacity
The figure for the maximum installed capacity was provided by the generator in its application for a
CfD and specified in its CfD contract following allocation. Thereafter the installed capacity figure can
only be reduced by the generator for a permitted contractual construction event (which is a narrowly
defined concept) or by the difference by which the relevant project has an installed capacity of 95%
(or 85% in the case of offshore wind) of its current contractual installed capacity figure and 100%.
The actual output of the generator will depend on the load factor.
The Hinkley Point C CfD does not have an installed capacity cap and is only entitled to CfD payment
support up to a generation cap of 910,000,000 MWh.
d. Load factor
Load factor is defined as the actual power output of a project as a proportion of its rated installed
capacity. It is a percentage figure which is used to transform installed capacity into actual power
output (generation). Load factor assumptions are based on reference factors published by the
Department for given technology types; however, actual power outputs are sensitive to technological
and environmental factors which may impact actual cash flows. Plant specific load factors (where a
minimum of 6 months’ generation data is available) is also available for consideration when valuing
the CfDs.
Strike price
The strike price is an agreed price which determines the payments made to the generator under the
contract with reference to its low carbon output and the market reference price. The relevant strike
price is specified in each CfD and is not intended to change for the duration of the project other than
through indexation to CPI and certain network charges or in the event of certain qualifying change in
law. The strike price used in the valuation of the CfDs is the 2020-21 strike price and reflects the CPI
rate for January 2020 in-line with the requirements of the CfD contract.
The relevant strike price for the Hinkley Point C CfD is specified at £92.50/MWh in real 2012 terms
and is not intended to change for the 35 year contract duration, other than through indexation to CPI
and certain network and balance charges, the event of certain qualifying changes in law, or the
additional factors discussed below. If a CfD in relation to Sizewell C is entered into before the reactor
one start date, then the applicable strike price shall be reduced with effect from the date of
satisfaction of the Sizewell C condition by £3/MWh. The LCCC’s management’s assumption with
regards to Sizewell C has not changed since last year hence the use of £92.50/MWh in calculating the
fair value of Hinkley Point C CfD.
Equity gain share for Hinkley Point C
The equity gain share mechanism consists of two separate components: (i) a mechanism to capture
gains above specified levels where the Hinkley Point C project outperforms relative to the original base

160
Annual report and accounts 2019-20
case assumptions; and (ii) a mechanism to capture gains above specified levels arising from the sale
of equity and economic interests (direct or indirect) in the Hinkley Point C project.
In each case, as and when the Internal Rate of Return (IRR) thresholds are reached:
• If the relevant IRR is more than 11.4%, the LCCC will receive 30% of any gain above this level.
• If the relevant IRR is more than 13.5%, the LCCC will receive 60% of any gain above this level.
No adjustment to the valuation has been made for equity gain share on the grounds that none of the
conditions outlined have been met.
Construction gain share for Hinkley Point C
If the construction costs of Hinkley Point C come in under budget, the strike price will be adjusted
downwards so that the gain (or saving) is shared with the LCCC. The gain share is 50/50 for the first
billion pounds, with savings in excess of this figure being shared 75% to the LCCC and 25% to the
generator, NNB Generation Company (HPC) Limited (NNBG).
If the outturn cost of construction is less than assumed then by reducing the strike price, the amounts
paid out to NNBG under the CfD will reduce and hence the benefit of the lower construction costs is
shared between NNBG and ultimately consumers. There is, however, no similar upward adjustment if
the construction cost of Hinkley Point C is over budget.
No adjustment to the valuation has been made for construction gain share on the grounds that there
has not been any construction gain during the year.
OPEX reopener for Hinkley Point C
The strike price may be adjusted upwards if the operational expenditure costs are more than assumed
and downwards if they are less. There are two operational expenditure reopener dates, at 15 years
and 25 years after the first reactor start date. The rationale behind the reopener is that the strike price
is based on long-term assumptions on operational expenditure costs. The reopener provides a way of
mitigating long-term cost risks for both parties.
No adjustment to the valuation has been made for OPEX reopener on the grounds that the OPEX
reopener dates have not yet been reached.
Sensitivity Analysis
Long term system forecasts are not generally seen as a single most likely outcome with degrees of
uncertainty either side. Rather there are multiple sets of inputs that are internally consistent and
credible. A set of these inputs is usually used as a ‘scenario’ and multiple deliberately different
scenarios are used to illustrate different possible futures when undertaking long term forecasting.
Therefore, individual forecasts may use a very different set of assumptions such as generation mix,
carbon and fuel costs, electricity demand and interconnector capacity, but still be within what we
would describe as the ‘universe of reasonableness’.
In order to value the CfD liabilities LCCC’s management have used future wholesale electricity prices
derived from the selected DDM reference case scenario. The Department has been able to estimate
wholesale electricity prices out to 2060 by effectively ‘freezing’ the 2050 model for all subsequent
years. The main driver facilitating the Department’s ability to do this has been the government’s
commitment in the year to bring all greenhouse gas emissions to Net Zero by 2050 (this giving more
certainty over potential generation mixes into the future).
The two reference case scenarios provided (with alternative levels of demand) represents the
Department’s view of the optimal generation mix (from the perspective of whole system costs) to
achieve net zero by 2050. The reference case scenario that was deemed the most reasonable
estimate of the two by management and used for the valuation produces a forecast price of
£39.81 per MWh in 2040 and £37.55 per MWh in 2050 (and 2060). These represent the Department’s
view of the optimal generation mix from the perspective of whole system cost to achieve net zero by
2050 based on low and high assumptions for future wholesale prices of oil, gas and coal. Under these
high/low fossil fuel prices scenarios the forecast price is £42.41/£33.53 per MWh in 2040 and

161
Financial Statements
£42.04/£33.35 per MWh in 2050 (and 2060). The impact on the CfD valuation of using these
alternative scenarios is shown in the table below.
It should be noted that independent third-party forecasters may use a very different set of assumptions
for their net zero by 2050 scenarios (e.g. different generation mix, commodity prices, carbon prices,
electricity demand and/or interconnector capacity) and that these different assumptions may produce a
future electricity price outside of the bounds of the range implied by the DDM high and low demand
cases. Independent third-party forecasters with a more pessimistic view on decarbonisation may also
use scenarios under which net zero is achieved at a later date. These scenarios will also use different
generation mix, commodity price and electricity demand assumptions and may produce electricity
prices further outside the bounds of the range implied by the DDM high and low cases.
Having undertaken appropriate due diligence management is satisfied that, whilst significant, the
estimation uncertainty associated with future wholesale electricity prices is not fundamental as to
prevent recognition. Available independent third-party price forecasts that management have reviewed
indicate a forecasting range of £16.20-£64.87 per MWh at 2040 and £14.72-£64.82 per MWh at
2050. It should be noted however that this range may not represent the full range of market views.
An additional element in the calculation of the CfD liability is the discount rate that is applied.
Uncertainty increases with time and so the choice of discount rate plays a significant part in
determining how much uncertainty is weighted into a present value calculation; a higher discount
rate places less weight on increasingly more uncertain years of a present value calculation. As in
the previous year the LCCC has used the HM Treasury discount rate of 0.7% for valuing financial
instruments such as CfDs. In the table below we have illustrated the impact of using a different rate
(the social discount rate of 3.5%, as published in the HM Treasury Green Book).
The following table shows the impact on the fair value of CfDs, classified under level 3, by applying
reasonably possible alternative assumptions to the valuation obtained using DDM. Due to the
significance and uniqueness of Hinkley Point C CfD the impact (and certain assumptions) have been
shown separately.
Favourable/
(Unfavourable)
changes
HPC CfD
Favourable/
(Unfavourable)
changes
Other CfDs
Favourable/
(Unfavourable)
changes
Total Impact

£m
£m
£m
Change in fair value of CfDs if:
DDM High Case
4,083
8,815
12,898
DDM Low Case
(4,552)
(5,866)
(10,418)
Discount rate of 3.5%
23,109
7,081
30,190
Specific to CfDs exc. HPC:
10% more load factor
–
(3,876)
(3,876)
10% less load factor
–
3,876
3,876
Estimated Commissioning Date moves backward by one year
–
(414)
(414)
Generation starts at the earliest possible date
–
90
90
Specific to HPC CfD:
At generation cap
(28)
–
(28)
10% less load factor
5,083
–
5,083
Generation starts at the earliest possible date
55
–
55
Generation start date delayed by 15 months
(65)
–
(65)
Sizewell C strike price adjustment
2,709
–
2,709

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Annual report and accounts 2019-20
The fair value is highly dependent upon the actual capacity generated once the plant is built and the
electricity prices which will prevail at the time of generation. The favourable and unfavourable changes
show how the impact of changes in capacity and prevailing electricity prices will affect the fair value of
the CfDs due to the change in the level of cash flows. As the sensitivity analysis illustrates, the overall
fair value movements are subject to material uncertainty.
Significant unobservable inputs
The following table discloses the valuation techniques and significant unobservable inputs for CfDs
recognised at fair value and classified as Level 3 along with the range of values used for these
significant unobservable inputs. Comparative values in the table below exclude the liability for HPC
as the HPC CfD was recognised in the current year.
Fair value of
CfDs
Valuation
technique
Significant
unobservable input
Range
Units

£m
Min – Max
2019
35,249
DCF
Electricity prices
44.55 – 67.73
£/MWh
2020
89,583
DCF
Electricity prices
32.69 – 60.46
£/MWh
10. Investments and loans in other public sector bodies
Ordinary
shares
Public
Dividend
Capital
Other
investments
and loans
Core
Department
and
Agencies
Total
Elimination
of shares
and other
investments
and loans
held in
NDPBs
NDPBs
Ordinary
Shares
Departmental
Group Total
£m
£m
£m
£m
£m
£m
£m
Balance at 1 April 2018
2,346
81
569
2,996
(1,826)
460
1,630
Additions
125
–
305
430
(352)
–
78
Redemptions
–
–
(24)
(24)
24
–
–
(Impairments)/
Impairment reversal
(30)
–
–
(30)
30
–
–
Revaluations
38
–
–
38
–
29
67
Unwinding of discount
–
–
1
1
(1)
–
–
Loans repayable within
12 months transferred to
current assets
–
–
(63)
(63)
46
–
(17)
Balance at
31 March 2019
2,479
81
788
3,348
(2,079)
489
1,758
Additions
19
–
238
257
(148)
–
109
Redemptions
–
(16)
(1)
(17)
–
–
(17)
(Impairments)/
Impairment reversal
(39)
–
–
(39)
39
–
–
Revaluations
(162)
–
20
(142)
(20)
44
(118)
Loans repayable within
12 months transferred to
current assets
–
–
(15)
(15)
(11)
–
(26)
Balance at
31 March 2020
2,297
65
1,030
3,392
(2,219)
533
1,706

163
Financial Statements
10.1 Ordinary Shares in other public sector bodies
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
2,479
1,404
2,346
1,337
Additions
19
19
125
–
(Impairments)/Impairment reversal
(39)
–
(30)
–
Revaluations
(162)
(118)
38
67
Balance at 31 March
2,297
1,305
2,479
1,404
Comprising
Ordinary Shares held within the Departmental
boundary – held at cost
1,524
–
1,564
–
Ordinary Shares held outside the Departmental
boundary – held at fair value
773
1,305
915
1,404
Balance at 31 March
2,297
1,305
2,479
1,404
Core Department
Ordinary Shares in other public sector bodies held within the Departmental boundary
In accordance with the FReM, ordinary shares held within the Departmental boundary are carried at
historical cost less any provision for impairment. They are eliminated on consolidation.
British Business Bank Plc (BBB)
The Core Department through the Secretary of State (SoS) holds 1,496,407,933 ordinary shares
(31 March 2019: 1,496,407,933), each with a nominal value of £1. The Core Department made £nil
(31 March 2019: £125 million) of share capital additions in BBB during the year. The Core
Department’s holding had a cost of £1,496 million at 31 March 2020 (31 March 2019: £1,496 million).
The principal objective of the company is to address long-standing, structural gaps in the supply
of finance and bring together in one place Government finance support for small and mid-sized
businesses.
UK Green Infrastructure Platform (UKGIP)
The Core Department through the SoS holds 90% of the share capital of UK Green Infrastructure
Platform Limited in the form of 900 ordinary shares (31 March 2019: 900), each with a nominal value
of £1.
UKGIP’s share capital was acquired for £93 million and the recognition of a shareholder loan of
£40 million. The Core Department’s holding had a cost less provision for impairment of £25 million at
31 March 2020 (31 March 2019: £65 million). The total loan outstanding at 31 March 2020 was £nil
(31 March 2019: £8 million) which is included within the Loans and investments in public sector
bodies note.
UKGIP was established to enable Government to retain an interest in five existing GIB investments.
The Green Investment Group is the remaining 10% shareholder. The primary activity of UK GIP is to
hold green investments and identify opportunities to realise them in a way which returns best value for
taxpayers’ money.
UK Shared Business Services Limited (UKSBS)
The Core Department though the SoS holds 62,016,358 non-voting shares and one voting share in
UKSBS, held at cost less provision for impairment of £3 million at 31 March 2020 (31 March 2019:
£3 million).

164
Annual report and accounts 2019-20
The company is a specialist business services organisation that provides finance, procurement,
grants, information systems and HR and payroll services to the public sector. Its main objective is
to improve the economy, efficiency and effectiveness of corporate services to BEIS bodies.
Low Carbon Contracts Company Limited (LCCC)
The Core Department through the SoS holds one ordinary share in LCCC with a nominal value of £1.
The principal objective of the company is to be the counterparty to and manage Contracts for
Difference (CfDs) throughout their lifetime.
Electricity Settlements Company Limited (ESC)
The Core Department through the SoS holds one ordinary share in ESC with a nominal value of £1.
The principal objective of the company is to oversee settlement of the Capacity Market agreements.
Enrichment Holdings Limited (EHL)
The Core Department through the SoS holds two shares of £1 each in EHL with a nominal value
of £2.
EHL has been set up as a holding company, along with a subsidiary company, Enrichment
Investments Limited (EIL), solely to hold the Government’s one third share in Urenco Limited, an entity
operating in the civil uranium enrichment sector.
BIS (Postal Services Act 2011) Company Limited
The Core Department through the SoS holds one ordinary share in BIS (Postal Services Act 2011)
Company Limited with a nominal value of £1.
The principal objective of the company is to dispose of the assets transferred to it from the Royal Mail
Pension Plan (RMPP).
South Tees Site Company Limited (STSC)
The Core Department through the SoS holds one ordinary share in STSC with a nominal value of £1.
The principal objective of the company is to secure and manage the South Tees Site.
Postal Services Holding Company Limited (PSH)
The Core Department through the SoS holds 50,005 ordinary shares in PSH which is 100% of the
issued share capital at a historic cost of £430 million at 31 March 2020 (31 March 2019: £430 million).
The Core Department through the SoS also owns one special share in PSH, relating to certain areas
for which Special Shareholder’s consent is required.
The Core Department’s holding had a cost less provision for impairment of £nil at 31 March 2020
(31 March 2019: £nil). PSH is currently in the process of liquidation due to the cessation of its primary
activities.
The principal objective of the company prior to cessation was to hold and manage its shares in Post
Office Limited (POL), which prior to cessation were transferred to the Core Department.
Ordinary Shares held outside of the Departmental boundary
Shares held outside of the Departmental boundary are carried at fair value.
Post Office Limited (POL)
The Core Department through the SoS holds 50,003 ordinary shares in POL at a nominal value of £1
each which is 100% of the issued share capital. There is a special share in POL (nominal value of £1)
which is held directly by the Secretary of State for BEIS.

165
Financial Statements
This shareholding is held at fair value, but as there is no active market for these shares the net asset
value of POL is considered to be a reasonable approximation for fair value. The fair value of the
investments, held by the Core Department, as at 31 March 2020 was £145 million (31 March 2019:
£256 million).
The principal objective of POL is to provide retail post office services through its national network
of branches.
British Nuclear Fuels Limited (BNFL)
The Core Department holds 50,000 ordinary shares in BNFL at a nominal value of £1 each. The Secretary
of State for BEIS holds 49,999 ordinary shares and the Treasury Solicitor holds one ordinary share.
The Core Department’s shareholding is held at fair value, but because there is no active market for
these shares the net asset value of BNFL is considered to be a reasonable approximation of fair value.
The fair value as at 31 March 2020 was £325 million (31 March 2019: £324 million).
Ordnance Survey Limited (OSL)
The Core Department through the SoS holds 34,000,002 ordinary shares in OSL at a nominal value of
£1 each which is 100% of the issued share capital.
The shareholding is held at fair value, but as there is no active market for these shares the net asset
value of OSL is considered to be a reasonable approximation for fair value. The fair value as at
31 March 2020 was £151 million (31 March 2019: £179 million).
The principal objective of OSL is to produce mapping products and mapping data information.
NPL Management Limited (NPLML)
The Core Department through the SoS holds 76 ordinary shares in NPLML which is 100% of the
issued share capital.
NPLML has been set up to manage and operate the National physical laboratory.
The shareholding is held at fair value, but as there is no active market for these shares the net asset
value of NPLML is considered to be a reasonable approximation for fair value. The fair value as at
31 March 2020 was £70 million (31 March 2019: £78 million).
NNL Holdings Limited (NNLH)
The Core Department through the SoS holds two shares of £1 each in NNLH with a nominal value of
£1 each.
NNLH has been set up as a holding company, to hold all the shares in the National Nuclear
Laboratory Limited.
The shareholding is held at fair value but because there is no active market for these shares the net
asset value of NNLH is considered to be a reasonable approximation of fair value. The fair value as at
31 March 2020 was £81 million (31 March 2019: £79 million).
NDPBs and other designated bodies
NDA subsidiaries
The NDA controls the following subsidiaries, all of which are outside the Departmental Group
boundary and not consolidated into these accounts. The holdings are valued at fair value. As there is
no active market, the net assets of the entities are considered the most appropriate approximation of
fair value and amounted to £533 million as at 31 March 2020 (31 March 2019: £489 million).

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Annual report and accounts 2019-20
Name
Country of
incorporation
Nature of business
Holding entity
Proportion of
ordinary
shares held
Direct Rail Services Limited
UK
Rail transport services within
the UK
NDA
100%
International Nuclear Services
France SAS (i)
France
Transportation of spent fuel
NDA
100%
International Nuclear Services
Japan KK (i)
Japan
Transportation of spent fuel
NDA
100%
International Nuclear Services
Limited
UK
Contract management and the
transportation of spent fuel,
reprocessing products and waste
NDA
100%
NDA Properties Limited
UK
Property management
NDA
100%
Pacific Nuclear Transport Limited (i)
UK
Transportation of spent fuel,
reprocessing products and waste
NDA
68.75%
Rutherford Indemnity Limited
Guernsey
Nuclear insurance
NDA
100%
(i) Ownership through International Nuclear Services Limited.
10.2 Public Dividend Capital (PDC)
Companies
House
UK Intellectual
Property Office
Met Office
Total
£m
£m
£m
£m
Balance at 1 April 2018
16
6
59
81
Additions
–
–
–
–
Redemptions
–
–
–
–
Impairments
–
–
–
–
Balance at 31 March 2019
16
6
59
81
Additions
–
–
–
–
Redemptions
(16)
–
–
(16)
Impairments
–
–
–
–
Balance at 31 March 2020
–
6
59
65
PDC is held by the Core Department. In accordance with the FReM, PDC is carried at historical cost
less any impairment.
The Office of National Statistics (ONS) determines whether an entity is classified to the public sector
and if classified to the public sector, whether an entity is included in the consolidation boundary for a
department, in 2018-19 the ONS reclassified Companies House from a public corporation
(a non‑consolidated public body) to a central government body (a consolidated body). This will result
in Companies House being consolidated into the Departmental Group accounts, this will occur, once
Companies House’s legal trading fund status has been revoked. The Revocation Order Statutory
Instrument (SI) 2019: No.1337, was laid on 15 October 2019 and comes into force on 1 April 2020.
Therefore, Companies House will be consolidated in the 2020-21 Departmental Group accounts.
See note 27 for further details.
10.2.1 Share of net assets and results for Public Dividend Capital holdings outside the
Departmental consolidation boundary
The Department is required to disclose its share of the net assets and the results for the year of other
public sector bodies, which are outside of the Departmental boundary. The following disclosures relate
to the Department’s trading funds.

167
Financial Statements
Companies
House
UK Intellectual
Property Office
Met Office
£m
£m
£m
Net Assets/(Liabilities) at 31 March 2019
79
93
259
Turnover
72
100
239
Surplus/profit (deficit/loss) for the year before financing
4
5
3
Net Assets/(Liabilities) at 31 March 2020
57
93
273
Turnover
72
111
249
Surplus/profit (deficit/loss) for the year before financing
(2)
5
15
For all bodies, information for 2019-20 was derived from their draft unaudited accounts. The information
for 2018-19 was derived from their audited accounts. The accounts were prepared on an IFRS basis,
in accordance with the requirements of the FReM.
10.3 Loans in public sector bodies
31 March 2020
31 March 2019

Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
788
273
569
211
Additions
238
90
305
79
Repayments
(1)
(1)
(24)
–
Unwind of discount
–
–
1
–
Revaluations
20
–
–
–
Loans repayable within 12 months transferred to
current assets
(15)
(26)
(63)
(17)
Balance at 31 March
1,030
336
788
273
Core Department
Loans in other public sector bodies
The balance comprises a number of loans to public sector bodies, the most significant loans making
up the balance are detailed below:
Energy Efficiency Loans
The Core Department’s energy efficiency loans scheme was set up under the Environmental
Protection Act 1990 to help businesses and public sector organisations reduce their energy costs by
providing interest free loans for the implementation of energy efficiency projects.
The total carrying amount with public sector bodies is £255 million at 31 March 2020 (31 March 2019:
£212 million). The non-current element of the loans is £202 million at 31 March 2020 (31 March 2019:
£169 million) included in the table above; the current element of these loans is £53 million at 31 March
2020 (31 March 2019: £43 million), which is included in note 15. The loans are accounted for at
amortised cost under IFRS 9.
These loans are to non-consolidated public sector entities and are not eliminated on consolidation.
Fleetbank Funding Limited Loan (Enable Funding programme)
The Core Department’s loan to Fleetbank Funding Limited is to provide funding to support the Enable
Funding programme, managed by the British Business Bank. This was launched in November 2014
and aimed at improving the provision of asset and lease finance to smaller UK businesses.
The total carrying amount of the Fleetbank Funding Limited loan is £410 million at 31 March 2020
(31 March 2019: £339 million). The non-current element of the loans is £410 million at 31 March 2020
(31 March 2019: £303 million) included in the table above; the current element of these loans is £nil at

168
Annual report and accounts 2019-20
31 March 2020 (31 March 2019: £36 million), which is included in note 15. The loans are accounted
for at amortised cost under IFRS 9.
This loan is to an entity that is consolidated within these financial statements and the loan is eliminated
on consolidation.
Northern Powerhouse Investment Limited and Midlands Engine Investment Limited Loans
The Core Department has loans with Northern Powerhouse Investment Fund and Midlands Engine
Investment Fund. The funds are matched by funding from the European Investment Bank. The funds are set
up to provide commercially-focused finance to help small and medium sized enterprises start up and grow.
The carrying amount of the loan investments in these entities is £140 million at 31 March 2020
(31 March 2019: £109 million). The loans are accounted for at cost under IAS 27.
These loans are to consolidated bodies and are eliminated on consolidation.
Met Office Loans
The Core Department’s loan with the Met Office funds UK membership of EUMETSAT. EUMETSAT is
a non-EU international organisation set up to develop, launch and monitor meteorological satellites
which provide global data for weather forecasting.
The total carrying amount of the Met Office loan is £118 million at 31 March 2020 (31 March 2019:
£91 million). The non-current element of the loans is £104 million at 31 March 2020 (31 March 2019:
£81 million) included in the table above; the current element of these loans is £14 million at 31 March
2020 (31 March 2019: £10 million), which is included in note 15. The loans are accounted for at
amortised cost under IFRS 9.
These loans are to non-consolidated bodies and are not eliminated on consolidation.
10.4 Special Shares
The Secretary of State holds one Special Share in each of the entities listed below. The list is a summary
and not a comprehensive record of the terms of each respective shareholding. Further details can be
obtained from the annual report and financial statements of each body or their Articles of Association.
The Core Department does not recognise the special or ‘golden’ shares on its Statement of
Financial Position.
Body in which Share is
held and type and value of
Share
Significant terms of Shareholding
Postal Services Holding
Company Limited.
£1 Special Rights Preference
Share
• Created in January 2001 (formerly called Royal Mail Holdings plc)
• It may be redeemed at any time by the shareholder
• The consent of the special shareholder is required for a number of decisions, including:
– Appointments to the Board (the special shareholder can also make appointments to
the Board)
– Setting (and approving any material changes in) the remuneration packages of the
Directors
– Borrowing
– Disposing of substantial assets of the business and shareholdings
– Voluntary winding-up of the company
– Varying certain of the company’s Articles of Association, including the rights of the
special shareholder.
Note: The company is now in members’ voluntary liquidation and control of its affairs has
been passed to the Joint Liquidators.

169
Financial Statements
Body in which Share is
held and type and value of
Share
Significant terms of Shareholding
Post Office Limited (“POL”)
£1 Special Rights
Redeemable Preference
Share
• Created in April 2012
• Special Shareholder is entitled to attend and speak at any general meeting or any
meeting of any other class of shareholders of POL, but the Special Share does not carry
voting rights or any other rights at any such meeting.
• It may be redeemed at any time by the Special Shareholder. POL cannot redeem the
Special Share without prior consent of the Special Shareholder.
• The consent of the special shareholder is required for a number of decisions, including:
– Varying POL’s Articles of Association, including the rights of the special shareholder;
– Appointment or removal from office of any Director of POL;
– Approval of (including material variations) Directors’ remuneration and terms of
employment;
– Adoption of (and any material variation in) POL’s strategic plan;
– Substantial alterations in the nature of the business carried on by POL;
– Sale of material assets in the absence of which POL would not be able to deliver its
strategic plan;
– Incurring of any borrowing exceeding pre-set limits as agreed with HM Treasury;
– Issuing or allotment of shares or granting of share rights in the company; and
– Voluntary winding-up of the company or member of the group.
– Any transaction which will result in a commitment or liability – either individually or
when taken together with related relevant transactions – of an amount in excess
of £50m.
BAE Systems plc
£1 Special Rights Preference
Share
• Created in 1985 (but subsequently amended).
• No time limit.
• Provides for a 15% limit on any individual foreign shareholding, or group of foreign
shareholders acting in concert, in the company.
• Requires a simple majority of the Board and the Chief Executive to be British.
• Requires any Executive Chairman to be British and, if both the Chairman and Deputy
Chairman are non-executives, requires at least one of them to be British.
Rolls Royce Holdings plc
£1 Special Rights Non‑Voting
Share
• Created in 1987 (but subsequently amended and transferred to Rolls-Royce Holdings plc).
• No time limit.
• Provides for a 15% limit on any individual foreign shareholding, or group of foreign
shareholders acting in concert, in the company.
• Requires a simple majority of the Board to be British.
• Allows either the Chairman or the Chief Executive to be either an EU or US citizen
provided that the other is a British citizen.
• Provides for a veto over the material disposal of assets of the group.
• Provides for a veto for a proposed voluntary winding up.
EDF Energy Nuclear
Generation Group Limited
(formerly British Energy
Group plc)
£1 Special Share
• British Energy Group plc Special Share created on 13 January 2005 and held jointly by
the Secretary of State for Business, Energy and Industrial Strategy and the Secretary of
State for Scotland.
• The consent of the Special Shareholder, which can only be refused on grounds of
national security (except in relation to an amendment to the company’s Articles of
Association), is required in respect of:
– various amendments to the company’s Articles of Association;
– any purchase of more than 15% of the company’s shares;
– the issue of shares carrying voting rights of 15% or more in the company;
– variations to the voting rights attaching to the company’s shares; and
– the giving of consent in respect of the issue of shares by, the sale of shares in or
amendments to the Articles of Association of various subsidiaries in certain cases.

170
Annual report and accounts 2019-20
Body in which Share is
held and type and value of
Share
Significant terms of Shareholding
British Energy Bond Finance
Limited (formerly British
Energy Holdings plc)
£1 Special Share
• British Energy Holdings plc Special Share created on 13 January 2005 and held jointly
by the Secretary of State for Business, Energy and Industrial Strategy and the Secretary
of State for Scotland.
• The consent of the Special Shareholder, which can only be refused on grounds of
national security (except in relation to an amendment to the company’s Articles of
Association), is required in respect of:
– various amendments to the company’s Articles of Association; and
– the giving of consent in respect of the issue of shares by, the sale of shares in or
amendments to the Articles of Association of various subsidiaries in certain case.
EDF Energy Nuclear
Generation Limited
(formerly British Energy
Generation Ltd)
£1 Special Share
• British Energy Generation Ltd Special Share created in 1996 is held solely by the
Secretary of State for Business, Energy and Industrial Strategy.
• The consent of the Special Shareholder, which can only be refused on grounds of
national security (except in relation to an amendment to the company’s Articles of
Association), is required in respect of:
– various amendments to the company’s Articles of Association;
– the disposal of any of the nuclear power stations owned by the company; and
– prior to the permanent closure of such a station, the disposal of any asset which is
necessary for the station to generate electricity.
British Energy Ltd (formerly
British Energy plc)
£1 Special Share
• British Energy plc Special Share created in 1996 is held solely by the Secretary of State
for Business, Energy and Industrial Strategy.
• The consent of the Special Shareholder, which can only be refused on grounds of
national security (except in relation to an amendment to the company’s Articles of
Association), is required in respect of:
– various amendments to the company’s Articles of Association; and
– the giving of consent in respect of the issue of shares by, the sale of shares in or
amendments to the Articles of Association of various subsidiaries in certain cases.
• The company has no significant assets or liabilities as a result of the restructuring
scheme, which came into effect on 14 January 2005.
Nuclear Liabilities Fund Ltd
£1 Special Rights
Redeemable Preference
Share
• Created in 1996.
• The Secretary of State for Business, Energy and Industrial Strategy has a Special ‘A’
Share (there is also a ‘B’ Share held by British Energy).
• The consent of the Special Shareholder is required for any of the following:
– to change any of the provisions in the Memorandum of Association or Articles of
Association;
– to alter the share capital or the rights attached thereto;
– the company to create or issue share options;
– the ‘B’ Special Shareholder or any of the Ordinary shareholders to dispose or transfer
any of their rights in their shares;
– the company to pass a members voluntary winding-up resolution;
– the company to recommend, declare or pay a dividend;
– the company to create, issue or commit to give any loan capital;
– the company to issue a debenture; or
– the company to change its accounting reference date.
10.5 Membership Fund
The Secretary of State for Business, Energy and Industrial Strategy has a share in the membership
fund of the Carbon Trust. The members’ fund at 31 March 2020 was £nil (31 March 2019: £nil).

171
Financial Statements
11. Other financial assets
31 March 2020
31 March 2019 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Note
£m
£m
£m
£m
Balance at 1 April
1,196
4,118
1,170
4,336
IFRS 9 adjustments
–
–
–
(423)
Revised balance at 1 April
1,196
4,118
1,170
3,913
Additions
3
1,246
25
1,171
Repayments
(346)
(1,172)
(236)
(1,051)
Effective interest
25
25
29
29
Unwinding of discount
–
–
–
2
Revaluations
89
(37)
212
100
Impairments
–
(60)
(4)
(69)
Impairment reversals
–
–
–
23
Balance at 31 March
967
4,120
1,196
4,118
Comprising:
Repayable launch investments
11.1
833
833
1,058
1,058
Other loans and investments
11.2
134
3,287
138
3,060
Balance at 31 March
967
4,120
1,196
4,118
Other financial assets – Other loans and investments have been restated, see note 26 for further details.
Other financial assets analysed between current and non-current assets:
31 March 2020
31 March 2019 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Due within twelve months
–
–
–
–
Due after twelve months
967
4,120
1,196
4,118
Total
967
4,120
1,196
4,118
11.1 Repayable launch investments
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
1,058
1,058
1,047
1,047
Repayments
(340)
(340)
(230)
(230)
Effective interest
25
25
29
29
Revaluations
90
90
212
212
Balance at 31 March
833
833
1,058
1,058
Repayable Launch Investments (RLI) are held by the Core Department.
The Core Department has determined that RLI are classified as ‘fair value through profit or loss
financial assets’ in accordance with IFRS 9. Fair value gains and losses are therefore recognised
directly in the SoCNE.
The Core Department, under the provisions of the 1982 Civil Aviation Act, provides repayable launch
investment to companies to fund a proportion of the non-recurring eligible design and development

172
Annual report and accounts 2019-20
capital costs on civil aerospace development products. Each product supported is covered by
separate contractual terms and conditions. Under these contracts, periodic repayments become due
when products are delivered or at other specific points. The portfolio of investments is valued twice
annually and the valuations are based on forecast annual income arising under each contract.
Measurement and carrying values
RLI contracts are initially recognised at fair value which is the transaction price. After initial recognition,
the value is the discounted forecast value of future income streams, excluding accrued income which
is included in receivables when products are delivered. The value of future income streams is
predominantly driven by the Core Department’s view of the applicable programme’s performance in
the global market over the period of the contract’s life; a number of activities inform this view and
some are described below.
The Core Department uses a variety of sources to inform a forecast of deliveries for individual
programmes. This can include using: an internal delivery forecast model and market share model,
forecast delivery schedules and other data directly provided from the RLI recipient companies, publicly
available aircraft delivery forecasts, specifically commissioned consultant programme forecasts as well
as commentary and views from industry experts.
The approach taken is entirely dependent on the programme in question.
Other valuation variables include inflation measures – or proxies (such as RPI, RPIX, gilt rates and
GDP deflators). Some contracts entitle the Core Department to a share of aircraft or engine spare part
and support income, and the valuation of these contracts is based on analysis of past income
streams and forecasts of future demand. The forecast income streams are adjusted by inflation of
2.35% and then are discounted to present value using a constant discount rate of 3.5% representing
the effective rate of return of the investment portfolio.
The carrying value of RLI is influenced by the interaction of key drivers such as aircraft or engine
deliveries and economic variables. The Core Department uses Monte-Carlo simulation to understand
the effect of different scenarios for these drivers on the valuation of each contract. The Core
Department considers that the carrying value is a reasonable approximation of the fair value of RLI.
The carrying value of the investments derived from the discounted cash flow model at 31 March 2020
was £833 million (31 March 2019: £1,058 million). The historic cost, including repayments to date and
excluding accrued income, of the portfolio at 31 March 2020 was £279 million (31 March 2019:
£389 million).
Sensitivity analysis
The Core Department has developed a Monte-Carlo based approach which uses the software
package @Risk to assess the impact of uncertainty on forecast income, overall contract values, and
enhance the robustness of the valuation process. Uncertainties are addressed by constructing
different scenarios for the key drivers and then assigning probabilities to these scenarios to implement
a Monte-Carlo simulation of the contracts on a contract-by-contract basis. The key variables include:
programme development delays, changes to entry into service and out of service dates, production
levels, market shares and economic variables used as inflation measures.
The contracts are highly complex and generally distinct from each other in their terms and structure, yet
there are cases of significant interdependencies between contracts and correlations between variables.
The model is iterated ten thousand times to produce distributions of income for each contract and
thus the overall portfolio. Each iteration of the model produces an income forecast. These are collated
and used to form an income distribution. It is from this distribution that the value of the portfolio is
calculated.
In order to give an assessment of potential volatility for the portfolio, we calculate the 5th and 95th
percentiles from the income distribution – 90% of all the iterations outputted from the Monte-Carlo
simulation lie between these particular percentile points. The lower (5th) and upper (95th) points
which define this interval were £772 million and £866 million respectively, at 31 March 2020 (2018-19:
£999 million and £1,076 million).

173
Financial Statements
Risk
Market risk
This constitutes the largest area of potential risk in the portfolio as the primary method of the
calculation of income streams is based on the forecasts of aircraft or engine deliveries. The Core
Department uses internal analysis, company information and third-party information to forecast
deliveries and ultimately future income on each investment over the life of the investment period.
Deliveries in the short term are driven by variables which include manufacturer production plans,
market cycles, customer demand and availability of financing. Medium and longer-term deliveries
will be affected by overall market growth and the market attractiveness of an aircraft programme.
A negative shift in outlook may result in the Core Department not being able to recover its investment
in whole or in part, although once deliveries have commenced some level of income is usually due to
the Core Department. The valuation has sought to take account of the economic downturn as a result
of COVID-19 and this has been reflected in updated forecasts. The Core Department aims to minimise
risk of under-recovery of investments by carrying out a full evaluation of each business case submitted
for launch investment support, and by ongoing monitoring programmes for the substantive life of the
contracts to allow it to assess exposure to risks (including project risk, market risk and technical risk).
Some contacts have fixed payment terms rather than payments on delivery of aircrafts, mitigating the
market risk further.
Interest rate risk
A number of the contracts use retail price indexes (such as RPI and RPIX) or other surrogates as a
tool to inflate the value of income due to the Core Department over time. As such there is a risk
relating to the forecasting of these indexes and surrogates within the valuation, although we estimate
that the risk is relatively low and the overall impact relatively minor.
Foreign exchange risk
The Core Department has a small number of contracts which may deliver a US Dollar denominated
income in their later stages which would be translated into pounds sterling. We assess these income
streams as relatively low value, thus exchange rate risk exists but is minimal in the context of the
overall portfolio.
Credit risk
Company failure could result in the Core Department’s investment not being recovered in whole or in
part. The Core Department seeks to offset this low probability risk by analysing the financial health of
any applicant at the time of application for launch investment and reviewing financial health as part of
the programme monitoring activity. In addition, contracts aim to contain provisions which will (as a
minimum) not disadvantage the Core Department compared to other creditors in the event of a
corporate failure. The Core Department takes steps to monitor the payments that become due to
companies under launch investment contracts to ensure they comply with the terms of the contracts.
Finally, the contracts also require the company’s auditors to confirm that all payments have been
made correctly and to identify any errors made.
Other risk
The Core Department’s investments are exposed to wider risks such as economic downturns or
market shocks from natural or non-natural events. These risks may adversely impact the value and
timing of the income received by the Core Department. The Core Department seeks to manage this
risk by actively monitoring such events when they arise to assess any potential impact.

174
Annual report and accounts 2019-20
11.2 Other loans and investments
Gilts and
bonds
Term
deposits
Private
sector loans
Property
related
holdings
Private
sector
shares
Equities
(listed
securities)
Private
equities
Investment
funds
Other
investments
Total
£m
£m
£m
£m
£m
£m
£m
£m
£m
£m
Balance at 31 March 2018
59
14
598
42
–
269
317
1,321
669
3,289
IFRS 9 adjustment – transfers between
categories
–
–
61
(42)
99
(269)
(317)
544
(76)
–
IFRS 9 adjustment – Other
(1)
–
2
–
–
–
–
37
(461)
(423)
Balance at 1 April 2018 restated
58
14
661
–
99
–
–
1,902
132
2,866
Additions
8
–
391
–
108
–
–
655
7
1,169
Redemptions
(25)
(1)
(228)
–
(24)
–
–
(515)
(28)
(821)
Revaluations
–
–
–
–
(16)
–
–
(54)
(43)
(113)
Unwinding of discount
2
–
–
–
–
–
–
–
–
2
Impairments
–
–
(63)
–
(3)
–
–
–
–
(66)
Impairment reversal
–
–
23
–
–
–
–
–
–
23
Balance at 31 March 2019 restated
43
13
784
–
164
–
–
1,988
68
3,060
Additions
6
–
604
–
22
–
–
608
6
1,246
Repayments
(8)
(7)
(450)
–
(17)
–
–
(320)
(30)
(832)
Revaluations
–
–
–
–
(8)
–
–
(75)
(44)
(127)
Impairments
–
–
(61)
–
–
–
–
1
–
(60)
Balance at 31 March 2020
41
6
877
–
161
–
–
2,202
–
3,287
Of the total:
Core Department and Agencies
–
–
2
–
44
–
–
88
–
134
NDPBs and other designated bodies
41
6
875
–
117
–
–
2,114
–
3,153
Balance at 31 March 2020
41
6
877
–
161
–
–
2,202
–
3,287
Other financial assets – Other loans and investments – Investment Funds have been restated, see note 26 for further details.

175
Financial Statements
NDPBs and other designated bodies
Private sector loans
British Business Bank (BBB), Fleetbank Funding Ltd (FFL) and UK Research and Innovation (UKRI)
have entered into loan agreements with parties within the private sector. The loans within the
Departmental Group are carried at historic cost as a proxy for amortised cost because the NDPBs
and other designated bodies have determined that there is no material difference between historical
cost and amortised cost.
As at 31 March 2020, £877 million of loans were held by NDPBs and other designated bodies
(31 March 2019: £784 million).
The value of loans held by BBB as at 31 March 2020 was £500 million (31 March 2019: £432 million).
The conditions attached to each loan vary depending on the details of the arrangement. Repayment
schedules have been agreed and all loans are expected to be repaid at the end of the loan term.
During the reporting period BBB made loans of £50 million (31 March 2019: £26 million) to private
companies through the BFP Small Business scheme. BBB provides invoice discount finance and peer
to peer lending through the Investment Programme funds which were valued at £257 million at
31 March 2020 (31 March 2019: £233 million). BBB provides loans to start ups and small businesses
via The Start Up Loans Company which were valued at £110 million at 31 March 2020 (31 March
2019: £137 million). The amortised cost valuations include Expected credit loss (ECL) provisions
taking account of the impacts of Covid-19 based on the available information at the reporting date.
Further information on the ECL provisions are given in note 22.
During 2019-20, FFL made loans of £288 million (31 March 2019: £141 million) to private companies
through the Enable Loan Programme scheme. The value of loans held by FFL as at 31 March 2020
was £366 million (31 March 2019: £330 million).
As part of the review undertaken on financial instruments on transition to IFRS 9 on 1 April 2018,
it was identified that £61 million of financial instruments held by BBB that were disclosed as
Investment funds, and would be more appropriately disclosed as a private sector loan. The balance at
31 March 2018 was transferred to the Private sector loan category. Remeasurement of the loan value
including related expected credit losses led to an adjustment on adoption of IFRS 9 of £2 million to
BBB’s private sector loans.
Private sector shares, Equities (listed securities) and Private equities
At 31 March 2020 the Departmental Group held £161 million of private sector shares (31 March 2019:
£164 million). These were held by BIS (Postal Services Act 2011) Company Ltd, Nesta Trust, and
UKRI. These are measured at ‘fair value through profit or loss’, with fair value movements going
directly to the SoCNE.
The fair values are estimated based on a variety of valuation techniques, adopted by the investment
managers that comply with the International Private Equity and Venture Capital Valuation (IPEV)
Guidelines or the valuation guidelines produced by the British Venture Capital Association (BVCA).
Valuation techniques used include the use of earnings multiples, discounted cash flows analysis,
and net asset values.
Nesta Trust holds the majority of private sector shares – they include holdings in a range of large
companies and smaller early stage investments with a total value at 31 March 2020 of £98 million
(31 March 2019: £104 million).
Private sector shares were split between listed securities and private equities as at 31 March 2018.
Following the IFRS 9 review, reclassification between categories was made to ensure a consistent
disclosure in 2018-19. In particular, £39 million of listed securities and £3 million of private equities
were transferred into private sector shares, with the remainder £544 million (made up of £230 million
Equities (listed securities) and £314 million Private equities) being transferred to investment funds.
In addition, £25 million was reclassified from Other investments to Private sector shares and
£32 million was reclassified from Investment funds, relating to holdings in Private sector shares.

176
Annual report and accounts 2019-20
Investment funds
BBB, Nesta Trust, BIS (Postal Services Act 2011) Company Limited, Northern Powerhouse
Investment Limited and Midlands Engine Investments Limited hold investment funds. The value
invested at 31 March 2020 was £2,202 million (31 March 2019: £1,988 million restated).
In accordance with IFRS 9, the investments are measured at ‘fair value through profit or loss’
with fair value movements going directly to the SoCNE.
BBB held investment funds valued at £1,495 million at 31 March 2020 (31 March 2019: £1,281
million). The most significant investment is in the Business Finance Partnership (BFP) for medium sized
businesses at 31 March 2020, this was valued at £408 million (31 March 2019: £435 million). The BFP
aims to increase the supply of capital through non-bank lending channels and, in the longer term, to
help to diversify the sources of finance available to businesses. BBB also has an investment fund in
Enterprise Capital Funds which were valued at £252 million at 31 March 2020 (31 March 2019:
£222 million), and a long-term venture and growth capital investment fund in British Patient Capital
valued £316 million at 31 March 2020 (31 March 2019: £198 million). The fair values of the Investment
Funds held by BBB are based on valuations at 31 December 2019 updated for cash movements.
They do not include any valuation adjustment calculated by the fund managers to take account of the
impact of Covid-19 on the valuations at 31 March 2020. The expected fair value adjustment based on
draft fund mangers reports of between -2% to -6% of the fair value of the Investment funds held by
BBB has not been included in the BBB valuations at 31 March 2020 as it would be an immaterial
adjustment.
The fair value of the investments in BPSA as at 31 March 2020 was £215 million (31 March 2019
restated: £274 million). These investments primarily comprised investments in European and North
American unquoted shares. The fair value of the Investment Funds held by BPSA include a valuation
adjustment of circa -8% calculated by the fund managers to take account of the impact of Covid-19
on the valuations at 31 March 2020.
In 2017-18, prior to the adoption of IFRS 9, under IAS 39 Investment Funds were classified as
‘available-for-sale financial assets’ with fair value movements recognised in Other comprehensive
income. As part of the implementation review for IFRS 9, it was identified that financial investments
of £42 million previously disclosed as Property related holdings, £230 million previously disclosed as
Equities (listed securities), £314 million previously disclosed as Private equites and £50 million
previously disclosed as Other investments, were reclassified as Investments funds which better
represent their nature. £61 million was transferred out of investment funds to private sector loans,
and £31 million was transferred out into private sector shares.
Under IFRS 9, embedded derivatives are no longer assessed separately from the host instrument,
leading to the transfer of BBB’s £31 million of embedded derivatives to the investment fund category,
prior to the adoption of IFRS 9, under IAS 39 this was disclosed as a Derivative.
In addition, the IFRS 9 adjustment – other has been restated by £6 million due to the BPSA
restatement along with the prior year in-year movements as explained in note 26.

177
Financial Statements
12. Recoverable contract costs
The Departmental Group has commercial agreements in place under which some or all of the
expenditure required to settle nuclear provisions will be recovered from third parties. Net recoverable
costs at 31 March 2020 were £1,425 million (31 March 2019: £1,620 million).
Departmental Group
31 March 2020
Departmental Group
31 March 2019
Recoverable contract costs relating to nuclear provisions
£m
£m
Gross recoverable contract costs
5,087
5,046
Less applicable payments received on account
(3,304)
(3,092)
Less associated contract loss provisions
(358)
(334)
Balance at 31 March
1,425
1,620
The above balances relate to the Nuclear Decommissioning Authority. The movements in gross
recoverable contract costs during the year were:
Departmental Group
31 March 2020
Departmental Group
31 March 2019
Movements in gross recoverable contract costs
£m
£m
Gross recoverable contract costs at 1 April
5,046
7,081
Increase/(decrease) in year
334
(1,510)
Unwinding of discount
(7)
(83)
Release in year – continuing operations
(185)
(276)
Amortisation of recoverable contract costs
(101)
(166)
Balance at 31 March
5,087
5,046
The gross balance of recoverable contract costs of £5,087 million (31 March 2019: £5,046 million)
comprises £1,516 million (31 March 2019: £1,617 million) of past costs which were incurred before
the revenue recognition period of the related contracts and will be amortised in future years in line with
revenue and £3,571 million (31 March 2019: £3,429 million) of probable future costs which form part
of the nuclear decommissioning provision (note 18.1) and will be released as they are incurred.
Further details are published in the NDA’s accounts.
The movement in the gross recoverable contract costs during the year broken down by the type of
costs are detailed in the table below:
Departmental Group
2019-20
Departmental Group
2018-19
Historic
costs
Future
costs
Total costs
Historic
costs
Future
costs Total costs
£m
£m
£m
£m
£m
£m
Balance at 1 April
1,617
3,429
5,046
1,783
5,298
7,081
Increase/(decrease) in the year
–
334
334
–
(1,510)
(1,510)
Unwinding of discount
–
(7)
(7)
–
(83)
(83)
Amortisation
(101)
–
(101)
(166)
–
(166)
Release in year
–
(185)
(185)
–
(276)
(276)
Balance at 31 March
1,516
3,571
5,087
1,617
3,429
5,046

178
Annual report and accounts 2019-20
The historic costs within the above are deemed contract assets under IFRS 15 ‘Revenue from
Contracts with Customers’. The opening balances, amortisation in period and closing balances for
each main contract type are:
Departmental Group
2019-20
Departmental Group
2018-19
Spent fuel
reprocessing
and
associated
waste
management
Spent fuel
receipt and
management
Total
Spent fuel
reprocessing
and
associated
waste
management
Spent fuel
receipt and
management
Total
£m
£m
£m
£m
£m
£m
Balance at 1 April
1,026
591
1,617
1,162
621
1,783
Amortisation
(71)
(30)
(101)
(136)
(30)
(166)
Balance at 31 March
955
561
1,516
1,026
591
1,617
Contract assets under IFRS 15 are deemed financial instruments for the purposes of IFRS 9 ‘Financial
Instruments’ and, therefore, are ordinarily required to be reviewed for expected credit loss impairment.
The above contract asset balances comprise costs which have been previously incurred and are now
being amortised in each reporting period. They are matched in full by payments on account and,
therefore, a credit loss impairment is not required.
13. Investments in joint ventures and associates
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
–
1,039
–
367
Opening balance transfer of investments
–
–
–
461
Revised balance at 1 April
–
1,039
–
828
Additions
–
30
–
37
Dividends
–
(94)
–
(87)
Disposals
–
(2)
–
–
Profit/(Loss)
–
(5)
–
186
Impairments
–
–
–
(1)
Revaluations
–
(1)
–
76
Balance at 31 March
–
967
–
1,039
NDPBs and other designated bodies
The Francis Crick Institute Limited (the “Crick”)
The Crick was established in 2010 to deliver a world class interdisciplinary biomedical research centre.
UKRI holds 42% (31 March 2019: 42%) of the ordinary shares in the Crick. The remaining shares are
held by Cancer Research UK, University College London, the Wellcome Trust, Kings College London
and Imperial College of Science, Technology and Medicine. The Crick became fully operational in
2016-17 following the completion of the Crick building. The value of the Departmental Group’s
investment at 31 March 2020 is £299 million (31 March 2019: £304 million), reflecting Departmental
Group’s share of net assets. This includes a £8 million upwards revaluation adjustment in 2019-20
(2018-19: £48 million) which aligns the Crick’s property, plant and equipment accounted for under the
‘historic cost’ model to the Departmental Group’s revaluation model.
The principal place of business is Midland Road, London.

179
Financial Statements
The results of the Crick are summarised below:
Summarised financial information
2019-20
2018-19
£m
£m
Current assets
56
85
Non-current assets
561
559
Current liabilities
(35)
(34)
Revenue
162
153
Profit/(loss) from continuing activities
(29)
4
Other financial information
2019-20
2018-19
£m
£m
Cash and cash equivalents
30
34
Depreciation and amortisation
(39)
(39)
Capital commitments
3
4
URENCO
URENCO is an international supplier of enrichment services. The Department holds 33% (31 March
2019: 33%) of the ordinary share capital through Enrichment Holdings Limited. From the adoption of
IFRS 9, the Department has accounted for its investment in URENCO as an associate rather than a
financial investment. At 31 March 2020, the Department’s holding is valued at £444 million (2018-19:
£551 million)
The principal place of business is Bells Hill, Stokes Poges, Buckinghamshire.
Summarised financial information
2019-20
2018-19
£m
£m
Current assets
1,340
804
Non-current assets
4,227
4,846
Current liabilities
(339)
(351)
Non-current liabilities
(3,614)
(3,646)
Revenue
1,582
1,732
Profit/(loss) from continuing activities
7
452
Other financial information
2019-20
2018-19
£m
£m
Cash and cash equivalents
275
216
Current financial liabilities (excl trade and other payables and provisions)
(31)
(30)
Non-current financial liabilities (excl trade and other payables and provisions)
(1,561)
(1,848)
Depreciation and amortisation
(312)
(284)
Amortisation of intangible assets
–
(7)
Interest income
65
61
Interest expense
(159)
(155)

180
Annual report and accounts 2019-20
14. Trade and other receivables
31 March 2020
31 March 2019 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Amounts falling due within one year:
Trade receivables
171
1,251
109
740
Other receivables:
VAT and other taxation
21
176
22
144
Staff receivables
1
2
2
3
RPS receivables
30
30
57
57
Other
177
250
143
184
Contract Assets
12
109
6
38
Prepayments and accrued income
126
440
108
399
538
2,258
447
1,565
Amounts falling due after more than one year:
Trade receivables
9
61
9
59
RPS receivables
42
42
–
–
Other receivables
689
699
804
833
Contract Assets
–
6
–
5
Prepayments and accrued income
–
40
–
41
740
848
813
938
Total receivables at 31 March
1,278
3,106
1,260
2,503
Trade and other receivables has been restated, see note 26 for further details.
Core Department
Other receivables held by the Core Department include a discounted receivable of £808 million
(31 March 2019: £920 million) relating to the Government guarantee of certain benefits payable to
members and beneficiaries of the Mineworkers’ Pension Scheme made after privatisation of the
British Coal Corporation in 1994. The amount receivable by the Core Department within 1 year is
£142 million (31 March 2019: £142 million), with the amount receivable not within 1 year £666 million
(31 March 2019: £778 million).
The undiscounted amount is £916 million (31 March 2019: £1,058 million). The agreement relating to
the guarantee entitles the Government to a portion of any periodic valuation surpluses, generally
determined by the Government Actuary following triennial valuations, the most recent valuation was at
30 September 2017. The receivables have been classified as Amortised Cost assets in accordance
with IFRS 9: Financial Instruments. In accordance with IFRS 9 the receivable is initially recognised at
fair value which equates to the future cash flows being discounted at HM Treasury’s financial
instrument nominal rate of 3.7%. No additional income was recognised in 2019-20 (2018-19:
£475 million) in relation to an additional sum receivable from the September 2017 valuation (note 6.1).
A contingent asset in relation to a similar financial guarantee for the British Coal Staff Superannuation
Scheme is disclosed in note 24. More information about the pension schemes can be found at
http://www.mps-pension.org.uk and https://www.bcsss-pension.org.uk.
Agencies
The Redundancy Payment Service (RPS) receivable is shown net of an annual impairment. The
impairment is calculated by the Insolvency Service using a model which is approved by HMRC.
The model calculates the recoverable debt as £72 million as at 31 March 2020 (31 March 2019:
£57 million). In line with IFRS 9, RPS debts have been grouped into similar types, in this case they have
been grouped between preferential or non-preferential debts. Analysis of historic trends of recovery of
these types of debts has revealed that the best estimate of recovery is 6% for non‑preferential and
37.8% for preferential (31 March 2019: 5.5% for non-preferential and 40.7% for preferential).

181
Financial Statements
15. Investments and loans in public sector bodies: current
31 March 2020
31 March 2019

Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
666
620
732
732
Additions
5,379
5,379
6,240
6,240
Repayments
(5,373)
(5,353)
(6,369)
(6,369)
Loans repayable within 12 months transferred from
non-current assets
15
26
63
17
Balance at 31 March
687
672
666
620
Core Department
The most significant item included above is a loan facility to Post Office Limited (POL). Since October
2003 the Core Department has made available to POL a revolving loan facility of up to £950 million,
which was increased by a further £50m in December 2019 to £1,000 million. This is to help the
company fund its daily in-branch working capital requirements to deliver services through the network,
such as social benefits payments and access to cash. The facility was due to mature in March 2018
but was extended to run until 31 March 2021. The outstanding balance at 31 March 2020 was
£602 million (31 March 2019: £565 million) which is included in the £687 million (31 March 2019:
£666 million) above.
16. Cash and cash equivalents
31 March 2020
31 March 2019 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
1,283
2,078
1,246
2,034
Net change in cash and cash equivalent balances
(244)
80
37
44
Balance at 31 March
1,039
2,158
1,283
2,078
The following balances at 31 March were held
at:
The Government Banking Service (GBS)
1,038
1,881
1,282
1,828
Commercial banks and cash in hand
1
277
1
250
Balance at 31 March
1,039
2,158
1,283
2,078
Cash and cash equivalents has been restated, see note 26 for further details.

182
Annual report and accounts 2019-20
17. Trade payables and other liabilities
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Amounts falling due within one year:
VAT, social security and other taxation
10
132
10
108
Trade payables
38
580
79
195
Other payables
348
1,013
552
1,020
Contract liabilities (see note 17.1)
6
514
5
474
Other accruals and deferred income
1,342
3,139
979
2,569
Amounts issued from the Consolidated Fund for
supply but not spent at year end
1,036
1,036
1,280
1,280
Consolidated Fund Extra Receipts due to be paid to
the Consolidated Fund:
Received
2
70
3
6
2,782
6,484
2,908
5,652
Amounts falling due after more than one year:
Trade Payables
–
4
–
7
Contract liabilities (see note 17.1)
–
1,479
–
1,691
Other payables, accruals and deferred income
883
984
1,141
1,203
883
2,467
1,141
2,901
Total payables at 31 March
3,665
8,951
4,049
8,553
17.1 Contract liabilities
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
5
2,165
–
–
IFRS 15 Adjustment to opening balances
–
–
–
2,290
Revised balance at 1 April
5
2,165
–
2,290
Additions
1
297
5
703
Release to SOCNE
–
(469)
–
(828)
Balance at 31 March
6
1,993
5
2,165
Of the total
Due within 1 year
6
514
5
474
Due in over 1 year
–
1,479
–
1,691
Balance at 31 March
6
1,993
5
2,165

183
Financial Statements
Included under accruals and deferred income are:
Core Department
Promissory note liabilities with maturities of less than one year of £380 million (31 March 2019:
£284 million) and with maturities greater than one year of £926 million (31 March 2019: £1,140 million)
which represent amounts owed for various ODA (Official Development Assistance) programmes to
which the Core Department has contributed.
Other payables falling due within one year include £240 million (2018-19; £525 million) payable to the
British Business Bank (BBB) relating to the un-invested portion of its loan from the Nuclear Liabilities
Fund (NLF). Repayments of £285 million (2018-19; £75 million) were made in year. Since it is an
intercompany transaction, it is eliminated from the Departmental Group balance. See more detail on
the NLF loan in the narrative for NDPBs and other designated bodies that follows.
NDPBs and other designated bodies
The majority of contract liabilities are the sums received on account by the Nuclear Decommissioning
Authority relating to income from long term contracts to be recognised within one year of £502 million
(31 March 2019: £461 million) and after one year of £1,478 million (31 March 2019: £1,691 million);
more details are available in the Nuclear Decommissioning Authority’s accounts.
Included in Other payables due within one year in the table above is a loan to BBB from the NLF.
In August 2018 BBB received a loan from the NLF, a non-consolidated central government fund of
the Departmental Group. The purpose of this investment by NLF into BBB, is for the NLF to achieve
a higher rate of return than the NLF has on its investments in the National Loans Fund (NaLF) in
previous years. The carrying amount of the borrowing from NLF as at 31 March 2020 was
£532 million (31 March 2019: £604 million).
18. Provisions for liabilities and charges
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Note
£m
£m
£m
£m
Current liabilities:
Not later than one year
11,047
14,065
260
3,050
Total current liabilities
11,047
14,065
260
3,050
Non-current liabilities:
Later than one year and not later than five years
645
13,200
883
12,235
Later than five years
1,057
122,834
1,037
119,181
Total non-current liabilities
1,702
136,034
1,920
131,416
Total at 31 March
12,749
150,099
2,180
134,466
Total provisions
Nuclear
18.1
1,208
135,925
1,346
131,094
Other
18.2
11,541
14,174
834
3,372
Total at 31 March
12,749
150,099
2,180
134,466

184
Annual report and accounts 2019-20
The provision liabilities in tables 18.1 and 18.2 below have been discounted to present value using
discount rates as provided by HM Treasury. Discounting as at 31 March 2019 and 31 March 2020 has
been applied to nominal cash flows which include allowance for future inflation using a forecast of
consumer price inflation provided by HM Treasury except where a more appropriate forecast has been
identified for specific provisions. HM Treasury required this change in 2018-19, and the same basis
applies for 2019-20. The impact of the change in the discounting approach is included in the “Change
in discount rate” movement of provisions.
31 March 2020
31 March 2019
Nominal
discount
rate
Inflation
rate
Equivalent
real discount
rate
Nominal
discount
rate
Inflation
rate
Equivalent
real discount
rate
Cash outflows expected within
two years
0.51%
1.9%
(1.36%)
0.76%
2.0%
(1.22%)
Cash outflows expected
between two and five years
0.51%
2.0%
(1.46%)
0.76%
2.1%
(1.31%)
Cash outflows expected
between five and ten years
0.55%
2.0%
(1.42%)
1.14%
2.1%
(0.94%)
Cash outflows expected after
ten years
1.99%
2.0%
(0.01%)
1.99%
2.1%
(0.11%)
Allowances for future inflation and discounting can impact on reported liabilities significantly;
uninflated, undiscounted equivalent values are provided in the descriptions of the provisions below to
illustrate the effect.

185
Financial Statements
18.1 Nuclear provisions
British Energy
UK Atomic Energy
Authority
Decommissioning
Core
Department and
Agencies Total
NDA
Decommissioning
Contract loss
Departmental
Group Total
£m
£m
£m
£m
£m
£m
Balance at 1 April 2018
1,098
314
1,412
233,282
407
235,101
Net amount deducted from recoverable contract costs
–
–
–
–
209
209
Unwinding of discount
(17)
(5)
(22)
(3,615)
(15)
(3,652)
Change in discount rate
(4)
(33)
(37)
(95,969)
22
(95,984)
Provided in the year
25
146
171
(1,114)
(427)
(1,370)
Recoverable contract cost release in year
–
–
–
(276)
–
(276)
Provisions utilised in the year
(178)
–
(178)
(2,599)
(157)
(2,934)
Balance at 31 March 2019
924
422
1,346
129,709
39
131,094
Net amount deducted from recoverable contract costs
–
–
–
–
(25)
(25)
Unwinding of discount
(14)
(1)
(15)
(135)
(3)
(153)
Change in discount rate
13
7
20
216
11
247
Provided in the year
22
–
22
7,667
143
7,832
Provisions not required written back
–
(3)
(3)
–
–
(3)
Recoverable contract costs – release in year
–
–
–
(185)
–
(185)
Provisions utilised in the year
(162)
–
(162)
(2,595)
(125)
(2,882)
Balance at 31 March 2020
783
425
1,208
134,677
40
135,925
Estimated forward discounted cash flows as at 31 March 2020
Not later than one year
144
–
144
2,941
–
3,085
Later than one year and not later than five years
387
9
396
12,349
8
12,753
Later than five years
252
416
668
119,387
32
120,087
Total forward cash flows as at 31 March 2020
783
425
1,208
134,677
40
135,925

186
Annual report and accounts 2019-20
Core Department
British Energy
As a result of the restructuring of British Energy (BE) in January 2005, the Government assists
BE (now EDF Energy Nuclear Generation Limited) in meeting its contractual historic fuel liabilities.
The provision is based on the forecast payment schedule up to 2029 which is set out in the waste
processing contracts agreed between BE, BNFL and the Core Department. The discounted liability at
31 March 2020 is £783 million (31 March 2019: £924 million). Payments are adjusted in line with the
Retail Prices Index and the liability includes allowance for future inflation using a forecast for the Index
from the Office for Budget Responsibility. The undiscounted liability at 31 March 2020, at prices as at
the reporting date so excluding the impact of future inflation, is £726 million (31 March 2019:
£956 million).
UK Atomic Energy Authority (UKAEA) Decommissioning
The provision represents the estimated costs of decommissioning the Joint European Torus facility at
UKAEA’s Culham site, including the storage, processing and eventual disposal of radioactive wastes.
The Core Department retains the liability for these costs. Cost estimates in the detailed Life Time Plan
for decommissioning are reviewed annually and include an element of uncertainty given that much of
the work will not be undertaken until well into the future; timing of expenditure is dependent on the
closure date of the facility. The discounted liability at 31 March 2020 is £425 million (31 March 2019:
£422 million); the undiscounted liability at 31 March 2020, at prices as at the reporting date so
excluding the impact of future inflation, is £401 million (31 March 2019: £402 million).
NDPBs and other designated bodies
NDA Decommissioning
The NDA’s nuclear decommissioning liability represents NDA’s best estimate of the costs of
decommissioning plant and equipment on each of the designated nuclear licensed sites in
accordance with the published strategy.
The programme of decommissioning work will take until 2137 but, in preparing the estimate, the NDA
has focused in particular on the first 20 years which represent £58 billion out of the total £135 billion
provision (31 March 2019: £50 billion out of £130 billion). The estimates are necessarily based on
assumptions about the processes and methods likely to be used to discharge the obligations and reflect
the latest technical knowledge, existing regulatory requirements, Government policy and commercial
agreements. Given the very long timescale and the complexity of the plants and material being handled,
considerable uncertainty remains in the cost estimate, particularly in the later years. Discounting of the
forward cash flow estimates to present value also has a significant impact on the liability reported in
the Statement of Financial Position of £135 billion at 31 March 2020 (31 March 2019: £130 billion).
The undiscounted equivalent of this reported liability is £132 billion at 31 March 2020 (31 March 2019:
£123 billion). The Departmental Group auditors continue to include an emphasis of matter paragraph
in their audit certificate concerning the overall measurement uncertainty.
The NDA has commercial agreements in place under which a portion of the expenditure required to
settle certain elements of the decommissioning provision are recoverable from third parties. Changes
in future cost estimates of discharging these particular elements are therefore matched by a change in
recoverable contract costs. In accordance with IAS 37, these recoverable amounts are not offset
against the decommissioning provision but are treated as a separate asset (note 12).
Sensitivity Analysis
An increase of 0.5% in the discount rate would reduce the provision to £116 billion, whilst a decrease
in discount rate of 0.5% would increase the provision to £159 billion.
The change in discount rates (see page 184) in the current financial year produced a decrease of
£3,818 million (2019: £107,764 million increase). This figure excludes the change relating to inflation
plus the recoverable contract costs off-setting balance which otherwise result in a decrease of
£169 million.

187
Financial Statements
Analysis of expected timing of discounted cash flows for the NDA Nuclear Provision is as follows:
Waste Research Sellafield
Fuel
Manufacturing
& Generation
Others
2019-20
Total
2018-19
Total
£m
£m
£m
£m
£m
£m
£m
Up to 1 year
90
183
2,080
475
113
2,941
2,735
2 to 5 years
497
758
8,877
1,834
383
12,349
11,149
6 to 20 years
2,802
1,592
31,869
5,681
695
42,639
36,405
21 to 50 years
3,667
117
32,596
8,712
645
45,737
38,752
50 years +
4,233
55
23,110
3,440
364
31,202
41,617
11,289
2,705
98,532
20,142
2,200
134,868
130,658
Deduction in respect of Site Licence Companies pension receivable from NDA
(191)
(949)
Total NDA Decommissioning Provisions
134,677
129,709
Waste Research Sellafield
Fuel M&G
Others
2019-20
Total
2018-19
Total
Sensitivity
£m
£m
£m
£m
£m
£m
£m
Increase
25,912
173
83,558
2,014
110
111,767
117,341
Reduction
(3,860)
(346)
(13,926)
(2,014)
(220)
(20,366)
(24,333)
The NDA calculates its provision based on management’s best estimate of the future costs of the
decommissioning programme, which is expected to take until 2137 to complete. The NDA also
considers credible risks and opportunities which may increase or decrease the cost estimate, but
which are deemed less probable than the best estimate. These are the basis of the sensitivities
identified above, and the key sensitivities are as follows:
• Waste activities cover the Low Level Waste Repository and the Geological Disposal Facility (GDF),
with the key sensitivities being in the timing and costs of constructing and operating the GDF.
The above range from a reduction of £3,860 million to an increase of £25,912 million and reflect
three separate sensitivities:
–
The potentially higher costs of constructing and operating the GDF itself, which dependent on
the location and construction requirements of the facility, could be up to £22,780 million higher
(or £3,797 million lower) than the base case assumption
–
The impact of the timing of the facility’s construction and operations. The current planned date
for the facility to receive waste is 2045. NDA has identified a risk that the construction and
opening of the facility may be delayed beyond 2045 (Further information on this can be found in
the Governance Statement of the NDA’s Annual Report and Accounts). A delay to this date may
increase the cost of the facility itself, along with the cost of interim storage of waste at sites
across the NDA estate. A delay of a small number of years is considered to be within the overall
tolerance of the estimate for GDF construction and waste transfer, and is not considered to
have a material impact on the provision estimate. A longer delay of say 20 years could materially
impact the provision, by approximately £2,100 million.
–
A delay of 20 years would not necessarily increase the underlying costs of the facility, but would
increase the discounted value of the estimate by approximately £1 billion due to the effect of
long term negative discount rates.
• Activities on the sites primarily used for research (Dounreay, Harwell, and Winfrith) are concerned
with final decommissioning of assets and site clearance. Sites will be cleared by 2080. Options are
being explored to accelerate site clearance, which in the case of Dounreay would reduce the
provision by £346 million; an increase in the cost and/or a delay of past the latest anticipated
Interim State date (2033) would increase the provision by up to £173 million.

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Annual report and accounts 2019-20
• Sellafield represents activities associated with operation of the site, reprocessing and eventual
decommissioning, and includes all site overheads. Principal sensitivities are around the cost of
delivering the plan, particularly the costs of new construction, decommissioning and post
operational clean out (POCO) work in the long-term (beyond the next twenty years). The potential
costs range from a £13,926 million reduction against the current estimate, to a £83,558 million
increase.
• fuel manufacturing and generation (which for this purpose includes Magnox and Springfields)
programme of work includes defueling the generating stations and preparing for interim Care and
Maintenance (complete by 2030) followed by a final site clearance phase around 2070 to 2107.
The main cost risk is in the final site clearance phase, which may increase costs by £2,014 million.
Conversely a reduction in the costs associated with this phase may reduce costs by £2,014 million.
Further details are reported in the Financial Review on page 29 of the Annual Report and in the NDA
Annual Report and Accounts.
Contract loss
Contract loss provisions have been recognised by the Nuclear Decommissioning Authority to cover
anticipated shortfalls between total income and total expenditure on relevant long term contracts.
The amounts are disclosed net after deduction of amounts relating to recoverable contract costs
(note 12). The amount provided in the year for contract losses relates to changes in estimates of the
costs of existing contracts. The discounted liability at 31 March 2020 is £40 million (31 March 2019:
£39 million). Further detail, including movement on the gross provision, can be found in the accounts
of the NDA.

189
Financial Statements
18.2 Other provisions
Business
support grant
Concessionary
fuel
British
Shipbuilders
Legacy
ailments
Other
Core and
Agencies
total
Coal
Authority
Early
departure
costs and
restructuring
Other
Departmental
Group total
£m
£m
£m
£m
£m
£m
£m
£m
£m
£m
Balance at 1 April 2018
–
463
201
124
254
1,042
4,328
85
195
5,650
Change in discount rate
–
(42)
(56)
(11)
(18)
(127)
(2,634)
–
(38)
(2,799)
Provided in the year
–
–
–
8
47
55
776
12
10
853
Provisions not required written
back
–
(11)
(1)
–
(3)
(15)
(74)
(1)
(2)
(92)
Provisions utilised in the year
–
(40)
(7)
(18)
(41)
(106)
(28)
(16)
(4)
(154)
Unwinding of discount
–
(7)
(3)
(2)
(3)
(15)
(69)
(1)
(1)
(86)
Balance at 31 March 2019
–
363
134
101
236
834
2,299
79
160
3,372
Reclassifications
–
–
6
62
(68)
–
–
–
–
–
Change in discount rate
–
3
1
1
2
7
(96)
–
69
(20)
Provided in the year
10,824
11
23
5
29
10,892
93
34
36
11,055
Provisions not required written
back
–
–
(27)
(12)
(68)
(107)
(1)
(1)
(16)
(125)
Provisions utilised in the year
–
(37)
(7)
(20)
(23)
(87)
(31)
(22)
(17)
(157)
Unwinding of discount
–
(1)
3
(1)
1
2
42
–
5
49
Balance at 31 March 2020
10,824
339
133
136
109
11,541
2,306
90
237
14,174
Estimated forward discounted cash flows as at 31 March 2020
Not later than one year
10,824
36
7
17
19
10,903
33
20
24
10,980
Later than one year and not
later than five years
–
119
30
46
54
249
148
36
14
447
Later than five years
–
184
96
73
36
389
2,125
34
199
2,747
Total forward cash flows as
at 31 March 2020
10,824
339
133
136
109
11,541
2,306
90
237
14,174

190
Annual report and accounts 2019-20
Core Department
Business support grant
A constructive obligation was created for the Core Department by Government announcements and
other associated actions in March 2020 relating to support grants to be paid to eligible businesses in
England to ameliorate the adverse economic consequences of the COVID-19 pandemic. The grant is
to be paid to recipients under two schemes, the Small Business Grant Fund and the Retail, Hospitality
and Leisure Grant Fund, subject to the recipients meeting eligibility criteria assessed as at 11 March
2020. Subject to meeting these criteria, businesses are entitled to the grant on application while the
schemes remain open. The grant is to be paid to businesses by local authorities acting as agents on
behalf of the Department and applying the guidance at https://www.gov.uk/government/publications/
coronavirus-covid-19-guidance-on-business-support-grant-funding. Local authorities reported total
grant paid to recipients of £10,873 million as at 9 August 2020, £151 million of which had been paid
over in 2019-20 (note 4.4). The Department estimates a further £102 million will be paid by the
schemes’ closure date of 28 August 2020. The provision liability of £10,824 million as at 31 March
2020 (31 March 2019: £nil) is undiscounted and represents the Department’s estimate of total
payments to be made under the schemes in 2020-21; there is some uncertainty associated with this
estimate but the final outturn is not expected to be significantly different.
Concessionary fuel
The provision covers the cost of the Core Department’s responsibility, arising from government
announced guarantees, to provide either solid fuel or a cash alternative to ex-miners formerly
employed by British Coal and their dependants and to certain former employees who lost their
entitlement as a consequence of the restructuring and run down of UK Coal in 2013 and 2015;
it includes administration costs. Of the total of 40,000 current beneficiaries at 31 March 2020, 34,800
have opted for the cash alternative at an average cost per beneficiary of £779 per annum; the average
annual cost of solid fuel for the remainder is £1,147 per beneficiary excluding delivery costs and VAT.
The provision is based on standard female mortality rates and assumes beneficiaries will continue
to switch their entitlement from solid fuel to cash in line with rates observed in the recent past.
Costs are expected to be incurred up to 2062. The discounted liability at 31 March 2020 is
£339 million (31 March 2019: £363 million); the undiscounted liability at 31 March 2020, at prices
as at the reporting date so excluding the impact of future inflation, is £326 million (31 March 2019:
£352 million).
British Shipbuilders
The provision covers the cost of personal injury compensation claims by former employees of British
Shipbuilders and its subsidiaries arising primarily from exposure to asbestos during the course of their
work. The Core Department has taken on full responsibility for the liabilities of the former Corporation
which was abolished in March 2013. It is subject to considerable uncertainty. The discounted liability
at 31 March 2020 is £133 million (31 March 2019: £134 million (£140 million including £6 million
reclassified from Other)) and includes £23 million for administration costs which had not been included
in prior years. The estimate for compensation claims is based on an actuarial review as at 31 March
2019 and includes allowance for future inflation judged appropriate by the actuary. Administration
costs have been estimated by the Department.
British Coal Corporation Health Liabilities (Legacy ailments)
The provision covers the cost of compensation claims relating to personal injuries suffered by former
British Coal mineworkers between 1947 and 1994, responsibility for which transferred to the Core
Department on 1 January 1998 by a restructuring scheme under the Coal Industry Act 1994; it
includes legal and administrative costs, including the storage and management of former British Coal
records. The discounted liability at 31 March 2020 is £136 million (31 March 2019: £101 million
(£163 million including £62 million reclassified from Other)). The undiscounted liability, at prices as at
the reporting date so excluding the impact of future inflation, is £131 million (31 March 2019: £98
million (£159 million including £61 million reclassified from Other)) and is based on forecasts of
settlement of claims, taking account of discussion with the Core Department’s legal advisors and

191
Financial Statements
claim handlers and recent actuarial estimates; it is subject to considerable uncertainty. The part of the
undiscounted liability which relates to compensation claims is £74 million and comprises estimates at
prices as at the reporting date of £9 million (31 March 2019: £11 million) for induced hearing loss,
£52 million (31 March 2019: £68 million) for miscellaneous disease claims including phurnacite,
mesothelioma, pneumoconiosis, pleural thickening, asbestos related conditions, vibration white finger,
chronic obstructive pulmonary disease, cancer, pleural plaques and other minor benefits schemes,
£4 million (31 March 2019: £19 million) for litigation by former British Coal Coke Oven Workers and
£9 million for litigation by former employees of British Coal’s Coventry Homefire plant (31 March 2019:
£nil). The current estimate is that liabilities will extend up to 2050.
Onerous leases
The liability of £109 million for ‘Other’ Core and agency provisions at 31 March 2020 includes £54
million of provisions for onerous leases for the Core Department in respect of office accommodation at
151 Buckingham Palace Road, 10-18 Victoria Street and other locations. The leases are held by the
Government Property Agency but the obligation to finance their running costs remains with the Core
Department. The Department has attempted to mitigate potential losses by subleasing but, has
determined that, at the reporting date, neither current nor future potential subleases will recover the
full costs incurred. The estimate of future income from subleasing as at 31 March 2020 is higher than
at 31 March 2019, leading to a significant write-down of this liability. The discounted liability at 31
March 2020 is £54 million (31 March 2019: £113 million). The liabilities extend to 2026.
NDPBs and other designated bodies
Coal Authority
The Coal Authority provision relates predominantly to the Coal Authority’s responsibilities for mine
water treatment, public safety and subsidence, and subsidence pumping stations. Significant
uncertainties are associated with estimation of likely costs in respect of these liabilities. The
discounted liability at 31 March 2020 is £2,306 million (31 March 2019: £2,299 million). The
undiscounted liability at 31 March 2020 is £2,275 million (31 March 2019: £2,174 million).
Further details are reported in the Coal Authority Annual Report and Accounts.
Early departure costs and restructuring
£78 million (31 March 2019: £67 million) of the restructuring provision relates to site licence
companies and includes continuing annual payments under early retirement arrangements to
individuals who retired early, or had accepted early retirement, before 31 March 2020 and will
continue at least until the date at which the individual would have reached normal retirement age.
The undiscounted equivalent is 31 March 2020 is £75 million (31 March 2019: £68 million).

192
Annual report and accounts 2019-20
19. Financial guarantee and loan commitment liabilities
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
54
230
61
61
IFRS 9 Adjustments to Opening Balances
–
–
(16)
168
Revised balance at 1 April
54
230
45
229
Additions
–
10
20
58
Net remeasurement
50
11
–
(46)
Called
(13)
(13)
(11)
(11)
Balance at 31 March
91
238
54
230
Comprising:
Financial guarantee liabilities
91
91
54
54
Loan commitment liabilities
–
147
–
176
Balance at 31 March
91
238
54
230
Of which:
Current liability
17
17
11
11
Non-current liability
74
221
43
219
Balance at 31 March
91
238
54
230
Following the introduction of IFRS 9 ‘Financial Instruments’ in 2018-19 the British Business Bank’s
Enterprise Capital Fund commitments to provide loans under the market rate were designated to be
measured at Fair Value through Profit or Loss. As a result, the Departmental Group has transferred out
the loan commitment liabilities of £184 million as at 31 March 2018 from “Other provisions” to disclose
separately together with financial guarantee liabilities.
20. Retirement benefit obligations
The Departmental Group consolidates nine defined benefit pension arrangements from its designated
bodies including:
• UK Research and Innovation
• Nuclear Decommissioning Authority
• Nuclear site licence companies
All schemes are accounted for in accordance with IAS 19 ‘Employee Benefits’. They are subject to
the UK regulatory framework and under the scope of the scheme specific funding requirement.
The schemes’ trustees are responsible for operating these defined benefit plans and have a statutory
responsibility for ensuring the schemes are sufficiently funded to meet current and future benefit
payments.
Defined benefit scheme liabilities expose the Departmental Group to material financial uncertainty,
arising from factors such as changes in life expectancy and in the amount of pensions payable. Some
scheme investments, such as equities, should offer long-term growth in excess of inflation, but can be
more volatile in the shorter term than government bonds.
The details of each scheme are discussed below.
UK Research and Innovation (UKRI)1
UKRI operates the legacy Medical Research Council (MRC) defined benefit, final salary pension
scheme. A full actuarial evaluation was undertaken as at 31 December 2016 which was rolled forward
by the actuary to determine the approximate position as at 31 March 2020.
1
MRC pension scheme values have been provided in an IAS 19 GAD report, this current surplus figure includes some pension asset figures
from 31 December 2019, the latest available information. Any subsequent movements in the valuations to 31 March 2020 are immaterial.

193
Financial Statements
The key assumptions are discount rate of 2.30% (2018-19: 2.40%) and rate of increase in pension
payments of 2.00% (2018-19: 2.45%). A decrease of 0.5% in the discount rate would lead to an
increase of approximately 10.0% in the total liability, while a decrease of 0.5% in the rate of increase
in pensions would lead to an approximate 7.0% reduction.
Further details regarding the nature of the benefits provided, regulatory framework, actuarial
assumptions, sensitivity analysis, key risks and risk management policy including asset-liability
matching strategies, and any funding arrangements or funding policy that may affect future
contributions can be found in the accounts of UKRI.
Nuclear Decommissioning Authority (NDA)
Two defined benefit pension schemes relate to the NDA – the Closed and Nirex sections of the
Combined Nuclear Pension Plan (CNPP). Both are closed to new entrants. Full actuarial evaluations
were undertaken as at 31 March 2016. The actuaries rolled forward the results to determine
approximate positions as at 31 March 2020. Further details regarding the nature of the benefits
provided, regulatory framework, actuarial assumptions, sensitivity analysis, key risks and risk
management policy including asset-liability matching strategies, and any funding arrangements or
funding policy that may affect future contributions can be found in the accounts of NDA.
Nuclear site licence companies (SLCs)
There are six defined benefit final salary pension schemes relating to the four SLCs comprising: a) the
LLWR section of the CNPP (for LLW Repository Limited), b) the SLC section of the Magnox Electric
Group of the ESPS and the Magnox Section of the CNPP (for Magnox Limited), c) the Group Pension
Scheme SLC section of the CNPP and the Sellafield section of the CNPP (for Sellafield Limited) and d)
the Dounreay Section of the CNPP (for Dounreay Site Restoration Limited). All are closed to new
entrants. The most recent triennial actuarial valuations were undertaken as at 31 March 2016 for all six
SLCs schemes. The actuaries rolled forward the results to determine approximate positions as at
31 March 2020.
Further details regarding the nature of the benefits provided, regulatory framework, key risks and risk
management policy including asset-liability matching strategies, and any funding arrangements or
funding policy that may affect future contributions can be found in the CNPP Statement of Investment
Principles at https://www.cnpp.org.uk/document-library/, and in the Electricity Supply Pension
Scheme’s Annual Reports at https://megtpensions.com/finance-report.

194
Annual report and accounts 2019-20
31 March 2020
31 March 2019

Funded pension
schemes
Funded pension
schemes
£m
£m
Present value of defined benefit obligation at 1 April
8,240
7,632
Interest cost
199
197
Current service cost
253
248
Past service cost
7
15
Benefits paid
(239)
(231)
Actuarial (gains)/losses in financial assumption
(1,017)
422
Actuarial (gains)/losses on defined benefit obligation due to demographic
assumptions
(152)
(68)
Actuarial (gains)/losses arising from experience adjustments
(13)
13
Employee contributions
24
25
Transfer in
(28)
(13)
Present value of defined benefit obligation at 31 March
7,274
8,240
Fair value of assets at 1 April
7,319
6,946
Expected return on plan assets
176
179
Employer contributions
145
149
Benefits paid
(239)
(231)
Actuarial gains/(losses)
(210)
264
Employee contributions
24
25
Transfer in
(28)
(13)
Fair value of assets at 31 March
7,187
7,319
Net liability at 31 March
87
921
The decrease in the net liability at 31 March 2020 compared to 31 March 2019 is primarily due to a
decrease in the inflation rate applied to all defined benefit obligations between 31 March 2019 and 31
March 2020.

195
Financial Statements
Net (asset)/liability by scheme
31 March
2020
31 March
2019

Present
value of
defined
benefit
obligation
Fair value
of assets
Net liability/
(asset)
Present
value of
defined
benefit
obligation
Fair value
of assets
Net liability/
(asset)
£m
£m
£m
£m
£m
£m
UK Research and Innovation –
Medical Research Council
1,465
1,563
(98)
1,605
1,649
(44)
LLW Repository Ltd – LLWR
section of CNPP
32
23
9
33
22
11
Magnox Ltd – SLC section of
Magnox Electric Group of ESPS
2,856
3,251
(395)
3,298
3,214
84
Magnox Ltd – Magnox section of
CNPP
133
118
15
161
120
41
Sellafield Ltd – Group Pension
Scheme SLC section of CNPP
584
624
(40)
707
682
25
Sellafield Ltd – Sellafield section of
CNPP
1,929
1,369
560
2,119
1,386
733
Dounreay Site Restoration Ltd –
Dounreay section of CNPP
145
105
40
159
106
53
Nuclear Decommissioning Authority
130
134
(4)
158
140
18
Total net liability at 31 March
7,274
7,187
87
8,240
7,319
921
Asset allocation
31 March 2020
31 March 2019
£m
£m
Equities
1,797
2,211
Property
854
765
Government bonds
1,910
1,933
Corporate bonds
534
541
Other growth assets
1,883
1,734
Other
209
135
Balance at reporting date
7,187
7,319
The Magnox schemes had a total asset balance of £3,365 million, of which £1,434 million were
government bond assets and £1,339 million were other growth assets which were not quoted in an
active market. The Sellafield schemes had £1,992 million of total assets, the majority of which,
excluding the amount held in the Trustees’ bank account and some private equity investments due to
their illiquid nature, had a quoted market value in an active market. The UKRI – MRC scheme’s total
assets of £1,563 million included £904 million of quoted equities and £385 million of property assets.

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Annual report and accounts 2019-20
Expected contribution over the next accounting period
It is possible that the actual amount paid might be different to the estimated amount. This may be due
to contributions, benefits payments or pensionable payroll differing from expected, changes to
schemes’ benefits or settlement/curtailment events that are currently unknown.
31 March 2020
£m
31 March 2019
£m
UK Research and Innovation – Medical Research Council
24
25
LLW Repository Ltd – LLWR section of CNPP
1
1
Magnox Ltd – SLC section of Magnox Electric Group of ESPS
32
27
Magnox Ltd – Magnox section of CNPP
5
5
Sellafield Ltd – Group Pension Scheme SLC section of CNPP
6
7
Sellafield Ltd – Sellafield section of CNPP
75
78
Dounreay Site Restoration Ltd – DSRL section of CNPP
6
6
Nuclear Decommissioning Authority
1
1
Total
150
150
Weighted average duration of the defined benefit obligation plans
31 March 2020
Years
31 March 2019
Years
UK Research and Innovation – Medical Research Council
20
21
LLW Repository Ltd – LLWR section of CNPP
27
20
Magnox Ltd – SLC section of Magnox Electric Group of ESPS
16
16
Magnox Ltd – Magnox section of CNPP
21
22
Sellafield Ltd – Group Pension Scheme SLC section of CNPP
20
20
Sellafield Ltd – Sellafield section of CNPP
20
20
Dounreay Site Restoration Ltd – DSRL section of CNPP
20
20
Nuclear Decommissioning Authority
19
23
Major actuarial assumptions for SLC schemes
Dounreay Site
Restoration Limited
LLW Repository
Limited
Magnox Limited
(ESPS)
Magnox Limited
(CNPP) Sellafield Limited
2019-20 2018-19 2019-20 2018-19 2019-20 2018-19 2019-20 2018-19 2019-20 2018-19
Discount rate
2.3%
2.5%
2.4%
2.4%
2.3%
2.4%
2.3%
2.4%
2.3%
2.5%
Inflation (Retail Price
Index)
2.4%
3.5%
2.6%
3.2%
2.4%
3.5%
2.4%
3.5%
2.4%
3.5%
Life expectancy in
years at 65, currently
aged 65 (male)
21.3
21.8
21.9
21.8
21.3
21.8
Life expectancy in
years at 65, currently
aged 45 (male)
22.4
22.9
23.0
22.9
22.4
22.9
Life expectancy in
years at 65, currently
aged 65 (female)
23.2
23.7
23.8
23.7
23.2
23.7
Life expectancy in
years at 65, currently
aged 45 (female)
24.5
25.0
25.0
25.0
24.5
25.0
Life expectancy in
years at 60, currently
aged 60 (male)
27.8
28.0
25.9
28.0
Life expectancy in
years at 60, currently
aged 40 (male)
28.5
29.0
27.1
29.0
Life expectancy in
years at 60, currently
aged 60 (female)
29.8
30.0
27.9
30.0
Life expectancy in
years at 60, currently
aged 40 (female)
30.6
31.1
29.2
31.1

197
Financial Statements
Major actuarial assumptions for NDA and UKRI
Nuclear Decommissioning
Authority
UK Research and
Innovation
2019-20
2018-19
2019-20
2018-19
Discount rate
2.3%
2.5%
2.3%
2.4%
Inflation (Retail Price Index)
2.4%
3.5%
n/a
3.6%
Life expectancy in years at 65, currently aged 65 (male)
21.3
21.8
22.1
23.0
Life expectancy in years at 65, currently aged 45 (male)
22.4
22.9
23.8
24.9
Life expectancy in years at 65, currently aged 65 (female)
23.2
23.7
23.8
24.6
Life expectancy in years at 65, currently aged 45 (female)
24.5
25.0
25.4
26.5
Sensitivity analysis
Dounreay Site
Restoration
Limited
LLW
Repository
Limited
Magnox
Limited
Sellafield
Limited
Nuclear
Decommissioning
Authority
UK
Research
and
Innovation
£m
£m
£m
£m
£m
£m
0.5 percentage point
decrease in annual
discount rate
18
5
247
310
13
146
0.5 percentage point increase
in inflation assumption
18
5
231
310
13
103
1 year increase in life
expectancy
5
1
142
91
5
44
The table shows the increase in liability that would result from changes in these actuarial assumptions.
21. Capital and other commitments
Total minimum payments in respect of capital, lease and other commitments
31 March 2020
31 March 2019

Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Note
£m
£m
£m
£m
Contracted capital commitments
21.1
9
2,635
22
1,929
Minimum future payments under:
Operating leases
21.2
260
433
326
462
Finance leases
–
5
–
28
Other financial commitments
21.3
2,816
3,535
3,012
3,427
Total
3,085
6,608
3,360
5,846
21.1 Capital commitments
31 March 2020
31 March 2019

Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Contracted capital commitments not otherwise
included in these financial statements:
Property, plant and equipment
9
521
17
271
Intangible assets
–
1
5
20
Loans and Investments
–
2,113
–
1,638
Total
9
2,635
22
1,929

198
Annual report and accounts 2019-20
Core Department
The Core Department has not entered into any significant capital commitments.
NDPBs and other designated bodies
Capital commitments as at 31 March 2020 include the following significant items:
• Property, plant and equipment commitments for United Kingdom Research and Innovation (UKRI)
of £488 million (31 March 2019: £231 million).
• Investment commitments of £1,601 million (31 March 2019: £1,203 million) for the British Business
Bank plc (BBB) relating to undrawn investment commitments, £227 million (31 March 2019:
£176 million) for Northern Powerhouse Investment Limited relating to capital calls to be utilised over
the next seven years, £173 million (31 March 2019: £176 million) for Midlands Engine Investments
Limited relating to capital calls to be utilised over the next eight years and £86 million (31 March
2019: £83 million) for the BIS (Postal Services Act 2011) Company Limited, which has capital calls
relating to investments in respect of its private equity and property funds financial instruments.
21.2 Commitments under leases
21.2.1 Operating leases: Department as a lessee
Total future minimum lease payments under operating leases are given in the table below for each of
the following periods:
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Obligations under operating leases comprise:
Land:
Not later than one year
–
1
–
1
Later than one year and not later than five years
–
2
–
2
Later than five years
–
14
–
20
–
17
–
23
Buildings:
Not later than one year
56
72
57
73
Later than one year and not later than five years
102
146
139
176
Later than five years
95
183
122
172
253
401
318
421
Other:
Not later than one year
6
10
5
9
Later than one year and not later than five years
1
5
3
9
7
15
8
18
Total
260
433
326
462
The commitment for Buildings for the Core Department is £227 million at 31 March 2020 (31 March
2019: £295 million) which includes the lease on the property at 1 Victoria Street, London; this
commitment is £145 million at 31 March 2020 (31 March 2019: £187 million). Further information
about finance leases and sub-lease arrangements of the Agencies, NDPBs and other designated
bodies can be found in the accounts of the relevant bodies.

199
Financial Statements
21.2.2 Operating leases: Department as a lessor
Total future minimum lease receivables under operating leases are given in the table below:
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Receivables under operating leases for the
following periods comprise:
Not later than one year
1
9
–
10
Later than one year and not later than five years
1
25
1
25
Later than five years
–
41
3
40
Total
2
75
4
75
21.3 Other financial commitments
The Departmental Group has entered into non-cancellable contracts (which are not leases, PFI contracts
or other service concession arrangements) for subscriptions to international bodies and various other
expenditures. Future payments to which the Departmental Group is committed are as follows:
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Not later than one year
485
769
484
698
Later than one year and not later than five years
757
1,136
982
1,182
Later than five years
1,574
1,630
1,546
1,547
Total
2,816
3,535
3,012
3,427
21.3.1 International subscriptions
The financial commitments payable include subscriptions payable to international bodies, analysed by
the period in which the payments are due:
Within 1
Year
Later than
1 year and
not later
than 5
years
Later than
5 Years
Total
Total
31 March
2020
31 March
2019
Organisation
Note
£m
£m
£m
£m
£m
International Atomic Energy Agency
a
15
60
75
150
170
European Space Agency
b
264
150
–
414
682
Other subscriptions
9
33
42
84
73
Core Department and Agencies total
288
243
117
648
925
European Organisation for Nuclear Research
(CERN)
c
159
96
–
255
232
Institut Laue Langevin (ILL)
d
20
60
–
80
97
Other subscriptions
46
80
21
147
84
Departmental Group total
513
479
138
1,130
1,338
Notes
The Departmental Group is required to subscribe to a number of bodies on an on-going and continuous basis.
These subscriptions are paid in Euros, Swiss Francs and pounds sterling. The subscriptions described below
are paid in Euros or Swiss Francs and amounts paid are subject to fluctuations due to exchange rate
differences.

200
Annual report and accounts 2019-20
a) The Core Department is responsible for paying in the UK’s annual subscriptions to the International Atomic
Energy Agency (IAEA). The IAEA is the UN-affiliated organisation responsible for ensuring the safe, secure
and peaceful use of civil nuclear technologies, through monitoring nuclear safeguards, setting international
standards and guidance for nuclear safety and security promoting nuclear applications for development.
b) The UK Space Agency pays international subscriptions to the European Space Agency (ESA) three times
a year and these amounts are agreed several years in advance. The payments reported reflect existing
commitments on forward exchange contracts placed with the Bank of England to cover periods until
1 October 2021. The annual subscriptions are to be set at a minimum of €300 million and will be aligned
with the agreed ESA programmes activity. It is expected that these amounts will be paid by means of
forward exchange contracts or amounts translated on the date of payment.
c) United Kingdom Research and Innovation (UKRI) shares the funding of the capital and running costs of
CERN with other major scientific nations. There is a notice of withdrawal period of 12 months after the end
of the current calendar year. The commitment is due to end in 2021.
d) The UK, through UKRI, has signed up to International Conventions, with respect to Institut Laue-Langevin
(ILL). The 5th protocol of the Intergovernmental Convention was signed in July 2013 and will remain in force
until 31 December 2023. Thereafter it shall be tacitly extended from year to year unless any of the
governments give written notification to the other governments of its intention to withdraw from the
Convention. Any such withdrawal will take effect upon the expiry of two years from the date of receipt of the
notification by any of the other governments or on such later date as may be specified in the notification.
21.3.2 Other commitments
The financial commitments payable in future years include payments due under non-cancellable
contracts to the following organisations:
Within one
year
Later than
one year
and not
later than
five years
Later than
five years
Total
Total
31 March
2020
31 March
2019
Organisation
Note
£m
£m
£m
£m
£m
Met Office
a
93
442
1,423
1,958
1,893
Other commitments
104
72
34
210
194
Core Department and Agencies total
197
514
1,457
2,168
2,087
Other commitments
59
143
35
237
2
Departmental Group total
256
657
1,492
2,405
2,089
Core Department
The Core Department has entered into non-cancellable contracts which include agreements with the
Met Office (a trading fund owned by the Department) to provide meteorological services including the
Public Weather Service agreement which the Department manages on behalf of the government and
for which the forward commitment is separately itemised above; this agreement is of indefinite
duration but reviewed on an annual basis.

201
Financial Statements
22. Financial instruments
The carrying amounts of financial instruments in each of the IFRS 9 categories are as follows:
31 March 2020
31 March 2019 restated
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
Note
£m
£m
£m
£m
Financial assets
Financial assets at amortised cost:
Cash and cash equivalents
16
1,039
2,158
1,283
2,078
Receivables (i)
14
1,140
2,511
1,146
2,021
Loans to public sector bodies (ii) & (iii)
10.3, 15
1,431
1,008
1,285
893
Other financial assets and private sector loans
2
924
2
840
Total financial assets at amortised cost
3,612
6,601
3,716
5,832
Financial assets elected at fair value through
other comprehensive income (OCI):
Ordinary shares in public sector companies (iv)
10.1
773
1,305
915
1,404
Other financial assets
11.2
44
61
46
58
Total financial assets elected at FVOCI
817
1,366
961
1,462
Financial assets mandatory at fair value
through profit or loss (FVTPL)
Repayable launch investments
11.1
833
833
1,058
1,058
Derivatives – Forward contracts
9
9
24
24
Loans to public sector bodies (ii) & (iii)
49
–
–
–
Other financial assets
11.2
88
2,302
90
2,160
Total financial assets mandatory at FVTPL
979
3,144
1,172
3,242
Public dividend capital:
Public dividend capital
10.2
65
65
81
81
Total public dividend capital
65
65
81
81
Financial liabilities
Financial liabilities as amortised cost:
Payables (ii)
17
(1,434)
(2,835)
(1,924)
(2,623)
Total financial liabilities as amortised
cost
(1,434)
(2,835)
(1,924)
(2,623)
Financial liabilities mandatory at fair value
through profit or loss (FVTPL):
Derivatives – Forward contracts
–
–
(3)
(15)
Derivatives – Contracts for difference (CfD)
9
–
(16,464)
–
(12,921)
Total financial liabilities mandatory at
FVTPL
–
(16,464)
(3)
(12,936)
Financial liabilities designated at fair value
through profit or loss (FVTPL):
Loan commitment liabilities
19
–
(147)
–
(176)
Total financial liabilities designated at
FVTPL
–
(147)
–
(176)
Financial guarantee liabilities:
Financial guarantee liabilities
19
(91)
(91)
(54)
(54)
Total financial guarantee liabilities
(91)
(91)
(54)
(54)
Notes
i.
The amounts disclosed above as payables and receivables exclude any assets or liabilities which do not
arise from a contractual arrangement.
ii. Loans to public sector bodies comprises the loans detailed in note 15 and Other loans and investments in
Other public sector bodies detailed in note 10.3.

202
Annual report and accounts 2019-20
iii
Loans to public sector bodies in the Core Department for 2019-20 excludes £236 million (2018-19:
£169 million) related to the loan investments in the Northern Powerhouse Investments Limited, Midlands
Engine Investments Limited, Cornwall and Isles of Scilly Investments Limited and UK Climate Investments
LLP, as these are accounted for at cost under IAS 27 – Separate Financial Statements.
iv. Ordinary shares in public sector companies excludes bodies that are consolidated in the Departmental
Group, as these are held at cost, see note 10.1.
Financial risk management
IFRS 7 ‘Financial Instruments: Disclosure’ requires the disclosure of information which will allow users
of financial statements to evaluate the significance of financial instruments on the Departmental
Group’s financial performance and position and the nature and extent of its exposure to risks arising
from these instruments.
As the cash requirements of the Departmental Group are largely met through the Estimates process,
financial instruments play a more limited role in creating risk than would apply to a private sector body
of a similar size.
The Departmental Group is however exposed to credit, market, interest rate, liquidity and commodity
price risks due to the specific programmes and activities undertaken in pursuance of the
Departmental Group’s objectives.
Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other
party by failing to discharge an obligation.
Significant credit risks can be summarised as follows:
Core Department
Investment funds
Investee companies may not perform as expected and the Departmental Group may not recover its
initial investment. The Core Department minimises the risk by monitoring the overall performance of
the funds and to secure value for the Core Department as an investor. This includes a full evaluation
of each business case submitted prior to committing funds.
Financial guarantees
The Core Department is exposed to credit risk from potential default by recipients of loans guaranteed
by the Core Department, primarily in relation to the Enterprise Financial Guarantee (EFG) scheme.
Lending institutions are responsible under the scheme for determining that prospective borrowers are
commercially viable; they are required to apply normal commercial practice and losses are shared
between the Core Department and lending institution. As at 31 March 2020 the Core Department
has £539 million of EFG guarantees outstanding (31 March 2019: £588 million) which will expire over the
next ten years as the underlying debt matures. Due to a cap on payouts which limits the Core
Department’s exposure, the maximum amount that could be paid out if all loans defaulted is £179 million
(31 March 2019: £260 million). However, not all loans are expected to default and an estimated liability of
£91 million (31 March 2019: £54 million) has been recognised on the Statement of Financial Position.
NDPBs and other designated bodies
British Business Bank
The British Business Bank (BBB) investments are assessed by BBB’s Valuation Committee. BBB
produces credit risk ratings for its investments based upon a risk grading of the financial obligor and
the estimated Loss Given Default on that investment. Risk drivers which are assessed in setting the
ratings include the financial viability and lending safety of the investment and, if available, the rating
assigned by an external credit agency. This is mitigated by new product approval processes that

203
Financial Statements
assess default and loss rates, due diligence of delivery partners underwriting methods, and portfolio
monitoring and default models being put in place.
Credit risk rating and loss allowance
The Departmental Group has the following financial assets subject to the expected credit loss model:
• Trade receivables, contract assets, and lease receivables
• Loans, bonds, and term deposits
• Cash and cash equivalents
Trade receivable, contract assets and lease receivables
The Core Department applies the IFRS 9 simplified approach using an allowance matrix to measure
the lifetime expected loss allowance for trade receivables in accordance with the FReM guidance.
Trade receivables are grouped based upon credit risk characteristics and the number of past-due
days. Default is defined as 90 days past due. The loss rates are estimated using the historic data for
each aging group. Forward-looking information such as macroeconomic factors and entity specific
situations are considered for entities with significant outstanding balances. Balances with other core
central government departments are excluded from recognising stage-1 and stage-2 impairments
following the FReM adaptions.
On this basis, the loss allowance as at 31 March 2020 determined as follows for trade receivables in
the Core Department:
31 March 2020
Core Department
Current
1-30 days 31-60 days 61-90 days
91+ days
Total
Expected Loss rate
1%
4%
9%
45%
71%
Gross carrying amount- trade receivables
(excluding other government debt) (£m)
2
0
1
0
5
8
Loss allowance (£m)
0
0
0
0
4
4
31 March 2019
Core Department
Current
1-30 days 31-60 days 61-90 days
91+ days
Total
Expected Loss rate
11%
7%
2%
52%
100%
Gross carrying amount- trade receivables
(excluding other government debt) (£m)
5
1
1
0
5
12
Loss allowance (£m)
1
0
0
0
5
6
The loss allowance for trade receivable balances held by ALBs has been assessed at an organisation
level and the total loss allowance estimated is immaterial for detailed disclosure on loss rates.
The movement in the allowance for provisions in respect of trade receivables during the year is
disclosed below reflecting the allowance per the expected credit loss model under IFRS 9.
31 March 2020
31 March 2019
Core
Department
and Agencies
Departmental
Group
Core
Department
and Agencies
Departmental
Group
£m
£m
£m
£m
Balance at 1 April
15
22
–
–
IFRS 9 Adjustment to opening balances
–
–
14
15
Net remeasurement
(2)
1
1
7
Write-off
–
–
–
–
Balance at 31 March
13
23
15
22

204
Annual report and accounts 2019-20
Loans, bonds and term deposits
Where possible, the Departmental Group monitors changes in credit risk by tracking published external
credit ratings. For all assets other than those held by British Business Bank, an internal credit rating
system, which was developed based on other established methodologies, was used to assign credit
risks for loans that do not have external credit rating.12-month and lifetime probabilities of default are
based upon Moody’s published research on the global default rate adjusted for historical repayment
data and any macro-economic pressures which could impact the entity’s ability to repay the loan.
The British Business Bank (BBB) investments are assessed by BBB’s Valuation Committee.
BBB produces credit risk ratings for its investments based upon a risk grading of the financial
obligator and the estimated Loss Given Default on that investment. Further details can be found in
BBB’s annual report and accounts.
The following table presents an analysis of credit quality of loans, bonds and term deposits.
It indicates whether assets were subject to a 12-month ECL or lifetime ECL allowance, and
whether they were credit-impaired.
31 March 2020
31 March 2019
Amortised cost
Amortised cost
12 month
ECL
Lifetime
ECL- not
impaired
Lifetime
ECL-
impaired
Total
12 month
ECL
Lifetime
ECL- not
impaired
Lifetime
ECL-
impaired
Total
Credit rating
£m
£m
£m
£m
£m
£m
£m
£m
Low risk financial assets
1,410
–
–
1,410
1,267
–
–
1,267
Medium risk financial assets
284
62
–
346
310
25
2
337
High risk financial assets
180
38
–
218
115
19
–
134
Default financial assets
–
–
59
59
–
–
78
78
Total gross carrying
amounts
1,874
100
59
2,033
1,692
44
80
1,816
Loss allowance
(29)
(15)
(57)
(101)
(11)
(15)
(57)
(83)
Carrying amount
1,845
85
2
1,932
1,681
29
23
1,733
The Departmental Group does not hold any loans, bonds and term deposits measured at FVOCI.
The movement in the allowance for impaired loans, bonds and term deposits at amortised cost during
the year was as follows.
31 March 2020
31 March 2019
12m ECL
Lifetime
ECL not
impaired
Lifetime
ECL
credit
impaired
Total
12m ECL
Lifetime
ECL not
impaired
Lifetime
ECL
credit
impaired
Total
£m
£m
£m
£m
£m
£m
£m
£m
Balance at 1 April
11
15
57
83
–
–
–
–
IFRS 9 Adjustment to
opening balances
–
–
–
–
11
11
45
67
Revised balance at 1 April
11
15
57
83
11
11
45
67
Additions
11
4
–
15
5
8
3
16
Net remeasurement
5
12
15
32
(3)
(2)
(1)
(6)
Repayment
–
(7)
–
(7)
(1)
(2)
(2)
(5)
Transfer to credit loss
12 month
–
(2)
4
2
–
–
–
–
Transfer to credit loss not
impaired
2
–
9
11
–
–
12
12
Transfer to credit loss
impaired
(3)
(10)
–
(13)
(1)
–
–
(1)
Write-off
(1)
7
(27)
(21)
–
–
–
–
Balance at 31 March
25
19
58
102
11
15
57
83

205
Financial Statements
The primary reason for the increase in the loss allowance during 2019-20, is to take account of the
Covid-19 pandemic economic impact on borrower’s ability to repay their loans.
Cash and cash equivalents
The Departmental Group held cash and cash equivalents of £2,158 million as at 31 March 2020
(31 March 2019 (restated): £2,078 million). The cash and cash equivalents are held with banks and
financial institutions which are rated AA- to AA+ based on S&P ratings.
Impairment on cash and cash equivalents has been measured on the 12-month expected loss basis
and reflects the short maturities of the exposures. The Departmental Group considers that cash and
cash equivalents have a low credit risk based on the external credit ratings of the holding parties.
Financial guarantee contracts and loan commitments
BBB’s ECF loan commitments were designated to be measured at FVTPL and the credit risk is,
therefore, reflected in their fair value.
Collateral
The Departmental Group holds collateral over loans held at amortised cost. The collateral held is in
the form of cash and buildings. The value of the loan assets held which are secured by collateral is
£1,084 million (31 March 2019 restated: £1,006 million). The value of the collateral held is lower than
the value of the assets secured by the collateral. The collateral was considered in estimating the ECL.
Market risk
Market risk is the risk that fair values and future cash flows will fluctuate due to changes in market
prices. Market risk generally comprises of:
a) Foreign Currency risk
Core Department
The Core Department is exposed to a small amount of currency risk with respect to Repayable
Launch Investment contracts where income due from aircraft or engine sales may initially be based in
US Dollars, but it is minimal in the context of the overall Repayable Launch Investment portfolio.
Otherwise the Core Department’s exposure to foreign currency risk during the year was insignificant.
Foreign currency income was negligible, and foreign currency expenditure was a small percentage of
total expenditure (less than 1%).
All material assets and liabilities are denominated in pounds sterling.
Agencies
Forward contracts
UKSA pays an annual subscription in Euros to the European Space Agency (ESA) and has entered
into forward contracts to mitigate the risk. These derivative contracts have been designated as cash
flow hedges.
NDPBs and other designated bodies
Forward contracts
UKRI are subject to foreign currency risks and have entered into forward contracts to help mitigate
these risks. These derivative contracts have been designated as cash flow hedges by UKRI and at the
reporting date the hedges met the IFRS 9 effectiveness criteria.

206
Annual report and accounts 2019-20
Cash and cash equivalents held in foreign currency
BIS (Postal Services Act 2011) Company Limited, UKRI and Nesta Trust are subject to minor foreign
currency risk through the maintenance of bank accounts in foreign currencies (predominantly USD
and EUR) to deal with day-to-day overseas transactions.
b) Interest Rate risk
Core Department
The Core Department does not invest or access funds from commercial sources, but it is exposed
to interest rate risk with respect to the EFG – the Core Department is exposed to interest rate risk,
as the majority of the loan guarantees are provided against variable rate loans. The banks’ usual
lending practices mean that fixed rate loans are usually available only for small value short term loans.
To minimise the risk of default due to interest rate rises, accompanied by a decline in the economic
environment, the Core Department relies on the lenders assessment using best commercial practice
to manage the risk of default.
NDPBs and other designated bodies
BBB holds both fixed and variable rate investments. Interest rate risk is regularly monitored to ensure
that the mix of fixed and variable borrowing is appropriate. BBB does not use derivatives to hedge
interest rate risk.
The impact of interest rates affects the discount rate used to arrive at the fair value of the CfD liability
held by LCCC. Changes in interest rates which affect the discount rate would therefore affect the
Statement of Financial Position valuation. However, the Departmental Group is not financially exposed
to this risk because the liability is funded through a levy on suppliers.
c) Other Market risk
Core Department
The Core Department is exposed to wider risks relating to the performance of the economy as a
whole. The main risks resulting from a downward movement in the economy include failures of
investee companies of investment funds, loan defaults under the Core Department’s EFG Scheme
and negative impacts on the Core Department’s repayable launch investment income and valuations
from the potential resultant decrease in demand in the aerospace industry. For further information on
the assessment of market risk in relation to Repayable Launch Investments, see note 11.1.
NDPBs and other designated bodies
The Nesta Trust is exposed to equity price risk due to its investment of a portion of its endowment
assets in publicly listed equity investments. Nesta Trust minimises this risk by investing for the medium
to long term, diversifying its equity investments over a number of managers with complementary
styles, and invests in investment funds with large institutional investors. The performance of these
investment managers is monitored regularly.
The valuations of fair value through profit or loss financial assets are based on the valuations provided
by the fund managers in line with International Private Equity and Venture Capital (IPEV) Valuation
Guidelines or the valuation guidelines produced by the British Venture Capital Association (BVCA).
Valuation techniques used include the use of earnings multiples, discounted cash flows analysis, and
net asset values. The valuations in the Core Department, BPSA and NESTA Trust have been updated
to reflect the impact of COVID-19 as at 31 March 2020, based on the available information at 31
March 2020. These have seen a decrease in the valuations at 31 March 2020 of circa (8%). BBB have
seen valuations movements between (2%) and (6%). As the economic impacts of COVID-19 become
more certain the Departmental Group may see further fair value adjustments upwards or downwards.

207
Financial Statements
Inflation risk
The amounts payable under the CfD contracts will be affected by the indexation of strike prices to
reflect inflation and changes to wholesale electricity prices resulting from inflation. Inflation rates may
not continue at the relatively low levels experienced in recent years; the Group is not financially
exposed to this risk because the liability is funded through a levy on suppliers.
Liquidity risk
Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with
financial liabilities.
Core Department and Agencies
In common with other government departments, the future financing of its liabilities is to be met by
future grants of Supply, voted annually by Parliament. There is no reason to believe that future
approvals will not be forthcoming, therefore, on this basis the liquidity risk to the Core Department and
its Agencies is minimal.
NDPBs and other designated bodies
Information about the Departmental Group’s objectives, policies and processes for managing and
measuring risk can be found in the Governance Statement.
Commodity price risk
Commodity price risk is the risk or uncertainty arising from possible price movements. The amounts
payable under the CfD contracts are exposed to price risk through the fluctuations in future actual
wholesale electricity prices, specifically, on how they will differ from the current forecast of future prices
in the central scenario. However, the LCCC and the Departmental Group are not financially exposed
to this risk because the liability is funded through a levy on suppliers.

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Financial instruments: fair value hierarchy
The table below analyses financial instruments carried at fair value, by valuation method. The different
levels have been defined as follows:
– Level 1 – uses quoted prices (unadjusted) in active markets for identical assets or liabilities;
– Level 2 – uses inputs for the assets or liabilities other quoted prices, that are observable either directly or
indirectly;
– Level 3 – uses inputs for the assets or liabilities that are not based on observable market data, such as
internal models or other valuation method.
The following table presents the Departmental Group’s financial assets and liabilities that are
measured at fair value at 31 March 2020 and 31 March 2019:
31 March 2020
31 March 2019 restated
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
Note
£m
£m
£m
£m
£m
£m
£m
£m
Financial assets
FVOCI elected
Ordinary shares in public sector
bodies
10.1
–
1,305
–
1,305
–
1,404
–
1,404
Private sector shares
11.2
8
47
25
80
8
47
21
76
Total financial assets at FVOCI
8
1,352
25
1,385
8
1,451
21
1,480
FVTPL mandatory
Debt and venture capital investments
Repayable launch investments
11.1
–
–
833
833
–
–
1,058
1,058
Investment funds
11.2
145
–
2,057
2,202
187
–
1,801
1,988
Bonds
11.2
–
–
–
–
1
–
–
1
Private sector shares
11.2
81
–
–
81
88
–
–
88
Other investments
11.2
–
–
–
–
–
–
68
68
Derivatives – Forward contracts
–
9
–
9
–
24
–
24
Total financial assets at FVTPL
mandatory
226
9
2,890
3,125
276
24
2,927
3,227
Total financial assets measured
at fair value
234
1,361
2,915
4,510
284
1,475
2,948
4,707
Financial Liabilities
FVTPL mandatory
Loan commitment liabilities
19
–
–
(147)
(147)
–
–
(176)
(176)
Total liabilities at FVTPL
mandatory
–
–
(147)
(147)
–
–
(176)
(176)
FVTPL designated
Derivatives – Forward contracts
–
–
–
–
–
(15)
–
(15)
Derivatives – CfD
9
–
– (16,464) (16,464)
–
– (12,921) (12,921)
Total financial liabilities at
FVTPL designated
–
– (16,464) (16,464)
–
(15) (12,921) (12,936)
Total financial liabilities
measured at fair value
–
– (16,611) (16,611)
–
(15) (13,097) (13,112)
Transfers between levels of the fair value hierarchy are deemed to occur at the end of the reporting period.
There were no transfers between level 1 and 2 during the year.
Specific valuation techniques used to value financial instruments include:
– The fair value of the CfDs has been calculated using the income approach based on level 3 inputs, which
reflects the present value of future cash flows that are expected to occur over the contract term of the CfD.
– For details regarding the fair value measurement of RLI’s, refer to note 11.1.
– The fair value of forward foreign exchange contracts is determined using forward exchange rate at the
reporting date based on Level 2 inputs, with the resulting value discounted back to present value.

209
Financial Statements
– Other techniques, such as discounted cash flow analysis or for non-quoted ordinary shares and investment
funds that are not actively traded, the net assets of the company/ underlying fund are used. These are
classified as level 3.
– The fair value of Public Sector shares are based upon net assets and classified as level 2.
The following table presents the changes in level 3 instrument for the period ended 31 March 2020,
excluding the CfDs which are disclosed in note 9.
Ordinary
shares in
unlisted
private
equities
Repayable
launch
investments
Property
related
holdings,
Investment
funds and
Other financial
assets
Loan
Commitment
Liabilities
Total
£m
£m
£m
£m
£m
Balance at 1 April
21
1,058
1,869
(176)
2,772
Additions
2
–
614
(10)
606
Repayments/disposals
–
(340)
(318)
39
(619)
Revaluations
1
–
–
–
1
Gains and losses recognised in
SoCNE
1
115
(108)
–
8
Balance at 31 March
25
833
2,057
(147)
2,768
The following table presents the changes in level 3 instrument for the year ended 31 March 2019,
excluding the CfDs which are disclosed in note 9.
Ordinary
shares in
unlisted
private
equities
Repayable
launch
investments
Property
related
holdings,
Investment
funds and
Other financial
assets
Loan
Commitment
Liabilities
Total
£m
£m
£m
£m
£m
Balance at 1 April
308
1,047
1,567
–
2,922
IFRS 9 transfers into level 3
10
–
1
–
11
IFRS 9 transfer between different
investment categories
(298)
–
298
–
–
IFRS 9 transfers in/ (out) of fair
value
–
–
(60)
(184)
(244)
Revised balance at 1 April
restated
20
1,047
1,806
(184)
2,689
Additions
18
–
504
(38)
484
Repayments/disposals
–
(230)
(335)
46
(519)
Gains and losses recognised in
SoCNE
(17)
241
(106)
–
118
Balance at 31 March restated
21
1,058
1,869
(176)
2,772

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Annual report and accounts 2019-20
Maturity profiles – discounted cashflows
The maturity profile of the discounted cashflows for the CfDs excluding Hinkley Point C is shown
below:
< 1 year
2-5 years
>5 years
Total
£m
£m
£m
£m
As at 31 March 2019
871
4,441
7,609
12,921
As at 31 March 2020
1,520
4,337
10,607
16,464
23. Contingent liabilities
Core Department
The Core Department has the following contingent liabilities:
Basis of Recognition
Description
Unquantifiable
Core Department –
Financial Reporting
Council funding
A guarantee has been given to the Financial Reporting Council that, if the Council’s general
voluntary funding from external sources falls sufficiently for the Department to have to consider
making legislation to activate the statutory levy under section 17 of the Companies (Audit,
Investigations and Community Enterprise) Act 2004, the Department will make such a grant to
cover the Council’s costs as is sufficient to meet the preconditions in those levy raising powers
provided the requisite funding has not been made available through another grant.
Core Department –
Deeds relating to the
Mineworkers’ Pension
Scheme and British Coal
Staff Superannuation
Scheme under
Paragraph 2(9) of
Schedule 5 to the Coal
Industry Act 1994
Government guarantees were put in place on 31 October 1994, the day the schemes were
changed to reflect the impact of privatisation of the coal industry. They are legally binding
contracts between the scheme Trustees and the Secretary of State for Business, Energy and
Industrial Strategy. The guarantees ensure that benefits earned by scheme members during
their employment with British Coal, and any benefit improvements from surpluses which were
awarded prior to 31 October 1994, will always be paid and will be increased each year in line
with the Retail Prices Index. If, at any periodic valuation, the assets of the Guaranteed Fund of
either scheme were to be insufficient to meet its liabilities, the assets must be increased to
bring the Fund back into balance. This is a long-term contingent liability dependent on the
performance of the schemes’ investments and their mortality experience. Further details
regarding the schemes can be found in note 14.
Core Department –
Indemnity to Public
Appointment Assessors
The Cabinet Secretary has provided a government-wide indemnity to Public Appointments
Assessors (PAAs) against personal civil liabilities incurred in the execution of their PAA
functions.
Core Department –
Nuclear agreements and
treaties
The Department has a range of potential civil nuclear liabilities arising through its association
with the United Kingdom Atomic Energy Authority and British Nuclear Fuels Limited as well as
ensuring that the government complies with its obligations under the various international
nuclear agreements and treaties.
Core Department – Site
restoration liabilities
inherited from British
Coal
The Department inherited responsibility from British Coal to reimburse certain third parties for
costs incurred meeting statutory environmental standards in the restoration of particular
coal-related sites.
Core Department –
Nuclear Liabilities Fund
The Nuclear Liabilities Fund was established in 1996 to meet certain costs of decommissioning
eight nuclear power plants in the UK that have been owned and operated by EDF Energy
Nuclear Generation Limited since 2009. A constructive obligation was created in 2002 when
the government undertook to underwrite the Fund in respect of these liabilities to the extent that
the assets of the Fund might fall short; any surplus generated by the Fund would be paid over
to the government once the liabilities have been met. The total undiscounted estimated liability
as at 31 March 2020 of £23.3 billion (31 March 2019: £20.9 billion) has a present value of
£24.1 billion (31 March 2019: £22.3 billion). The value of the Fund as at 31 March 2020 is
£9.4 billion (31 March 2019: £9.4 billion). It is not possible to quantify the extent to which the
Fund might be in deficit or surplus with respect to the liabilities as at 31 March 2020 given the
high level of uncertainty relating to estimation of decommissioning costs and investment returns
on Fund assets over a future period exceeding 100 years.

211
Financial Statements
Basis of Recognition
Description
Core Department –
Horizon 2020 Funding
In July 2018, the UK Government announced an extension of its guarantee of EU-funded
projects after the UK has left the EU. The guarantee was originally announced in 2016. The UK
left the EU on 31st January 2020 Under the terms of the Withdrawal Agreement, the European
Union can exclude UK participation in Horizon 2020 EU-funded grants which involve security-
related sensitive information. This means that for security related projects under the Horizon,
there is a doubt over continued EU funding. The guarantee in relation to Horizon 2020 is
unquantifiable due to the European Commission administering and holding the information in
relation to the scheme. There are uncertainties around the total amount that may be payable if
the settlement were to occur.
Quantifiable
Core Department – Loan
guarantees (ENABLE)
(£356 million)
In order to encourage lending to smaller businesses, the Department has guaranteed a portion
of net losses on designated loan portfolios of participating banks (in excess of an agreed ‘first
loss’ threshold) in return for a fee under the ENABLE Guarantee programme administered by
the British Business Bank. The Department has approved guarantee facilities totalling
£1.4 billion (31 March 2019: £1 billion), of which £783 million is effective as at 31 March 2020
(31 March 2019: £283 million) with a potential loss to the Department of £356 million (31
March 2019: £45 million).
Core Department – Loan
guarantees (EFG and
HTG) (£180 million)
The Department guarantees lenders under the Enterprise Financial Guarantee (EFG) and Help
to Grow (HTG) financial guarantee schemes administered by the British Business Bank.
The Enterprise Financial Guarantee Scheme facilitates lending to viable businesses with the
maximum obligation for the Department capped at £179 million at 31 March 2020 (31 March
2019: £205 million). The amount lent under the Help to Grow scheme was £3 million at
31 March 2020 (31 March 2019: £2.9 million) with a maximum potential liability for the
department at 31 March 2020 of £1 million (31 March 2019: £1 million).
Core Department –
Ofgem administration
costs from the buy-out
fund (£4 million)
The Department, the Scottish Government and the Northern Ireland Executive have
undertaken to support Ofgem’s costs for administering the Renewables Obligation scheme
(around £4 million) if there is insufficient money in both the buy-out fund and late payment fund
to cover these costs. The size of the 2019-20 buy-out fund will not be known until October
2020. It is dependent in part on the availability and price of Renewable Obligation Certificates
(ROCs) – if there is a surplus of ROCs, suppliers may be more inclined to meet their obligations
by submitting ROCs but ultimately much depends on supplier behaviour which is difficult to
predict. The Department will have an indication of how many ROCs are available and whether
there is likely to be a surplus after the end of the obligation year (31 March 2020) but will not
know the size of the buy-out fund until October 2020.
Core Department – Wave
Hub transfer (£5 million)
The Department has indemnified Cornwall Council up to 2028 in respect of the transfer of
Wave Hub to a maximum of £5 million.
Departmental Group
The Departmental Group has the following contingent liabilities, which are either unquantifiable or
quantifiable contingent liabilities of more than £1 million in either this financial year or prior financial
year. Other liabilities are disclosed in our partner organisation accounts.
Basis of Recognition
Description
Unquantifiable
Coal Authority –
Environmental Legal
Claims
Under the Environmental Information Regulations 2004 – The Coal Authority is aware of
potential legal proceedings in respect of past fees paid for Mining Information. In the
eventuality of receiving formal notification to commence legal proceedings, the Coal Authority
will strongly defend its position.
Coal Authority -Legal
claims
The Coal Authority is subject to various claims and legal actions in the ordinary course of its
activities. Where appropriate, provisions are made in the accounts on the basis of information
available and in accordance with guidance provided under the FReM and IFRS. The Coal
Authority does not expect that the outcome of the above issues will materially affect its
financial position.

212
Annual report and accounts 2019-20
Basis of Recognition
Description
Coal Authority –
Restructuring Scheme
Where liabilities transferred under the various Coal Authority Restructuring Schemes (CARS)
have crystallised due to planning conditions, agreements, claims etc, provision has been made
in these financial statements. It has not, however, been possible to quantify contingent
liabilities that may arise in the future. It is expected that any costs will be covered by future
allocations of grant in aid.
Coal Authority –
Subsidence damage and
public safety liabilities
Licensees of mining operations are required to provide security to the Coal Authority to cover
the anticipated future costs of settling subsidence damage liabilities within their areas of
responsibility. Outside the areas of responsibility of the holders of licences under Part II of the
1994 Act, the Coal Authority is responsible for making good subsidence damage. Where an
area of responsibility is extinguished this would transfer to the Coal Authority who would
become responsible for the discharge of outstanding subsidence liabilities. The Coal Authority
also has an ongoing liability to secure and keep secured the majority of abandoned coal mines.
In all cases the liability for operating collieries is the responsibility of the licensees/lessees and
security is held to address those liabilities. The above liabilities have been provided for within the
Public Safety and Subsidence provision based on analysis of trends and claims experience.
However, it is possible that significant, unexpected events outside of this provision may
materialise. It is expected that any deficit will be covered by future allocations of grant in aid.
CNPA – Legal Claims
There are a number of potential liabilities in respect of claims from employees. The timing and
amounts of any payment are uncertain. These liabilities have not been provided for as the
CNPA believes that the claims are unlikely to be successful and unlikely to lead to a transfer of
economic benefits.
Insolvency Service-
Cheques Act 1992
Following the enactment of the Cheques Act 1992, the Secretary of State for BEIS has
indemnified the Insolvency Service’s bankers against certain liabilities arising in respect of
non-transferable “account payee” cheques due to insolvent estates and paid into the accounts
of the agency.
NDA – Pension Schemes
Whilst not the lead employer, the NDA is the lead organisation and has ultimate responsibility
for certain nuclear industry pension schemes, including the Combined Nuclear Pension Plan
and the Magnox section of the ESPS. Provisions for known deficits are included within Nuclear
Provisions. However, movements in financial markets may adversely impact the actuarial
valuations of the schemes, resulting in an increase in scheme deficits and consequent increase
in nuclear provision.
UKRI – Indemnity to
Roslin Institute
The former BBSRC sponsored Roslin institute transferred to the University of Edinburgh on
13 May 2008. BBSRC agreed to provide indemnity for any potential costs that arise as a result
of past actions of the institute and indemnity for any fall in grant income of the
Neuropathogenesis Unit as a result of the transfer. The proportion of settlement UKRI will fund
declines on an annual basis and is limited to claims up to May 2023.
Others
There are a number of potential liabilities for the Department in respect of claims from
suppliers, employees and third parties which depend on actual or potential proceedings.
The timing and amounts of any liabilities are uncertain.
Quantifiable
BBB – Financial
guarantee
(£3 million)
Under the Bank’s Help to Grow financial guarantee programme, the Bank has entered into
financial guarantee agreements of £10.5 million (31 March 2019: £30 million). The Bank has
guaranteed 75% of eligible lending to SMEs under these agreements and a counter guarantee
is in place that guarantees 50% of the Bank’s 75% of eligible lending. As at 31 March 2020 the
amount lent under these financial guarantee agreements was £3 million (31 March 2019: £3.2
million). During the year ending 31 March 2020 the remaining guarantee agreement originally
totaling £30 million was reduced to £10.5 million, with no further amounts being lent under it.
LCCC – Legal Dispute
There is an ongoing dispute between the company and another entity. The company has
confidence in a favourable outcome. If the outcome is not as anticipated, the company will be
required to make an annual payment from the interim levy of less than £10 million for the next
several years.
UKRI – (BBSRC)
Contamination
(£3 million)
As part of a Sale Agreement relating to a previous BBSRC site, BBSRC agreed to indemnify
the purchaser against contamination resulting from dangerous substances. The indemnity was
over a 10-year period commencing in 2013-14 and was capped at £3 million.

213
Financial Statements
Basis of Recognition
Description
UKRI – (BBSRC) Exit
costs (£31 million)
Prior to 31 March 2018, some staff at BBSRC strategically funded institutes were on BBSRC
terms and conditions. Whilst their direct salary costs are paid by the institutes, BBSRC is liable
for any exit costs for these staff. The date and number of staff to take exit packages in any one
year is unknown; however, if all staff were to take exit packages, the maximum liability is
estimated at £31 million, with the amount declining on an annual basis up to March 2022.
UKRI – (Innovate UK)
Decommissioning costs
(£2.6 million)
UKRI has a contingent liability which may arise if UKRI has to provide a grant to NAREC
(Natural Renewable Energy Centre) in order for it to be able to decommission a weather
monitoring platform in the North Sea. This is currently collecting data to support the
development of an offshore wind test site. This may take place anytime between three and
25 years from now dependent on the development of the site, at an estimated cost of
£2.6 million.
UKRI – (STFC)
Decommissioning costs
(£1.8 million)
A contingent liability exists for European Synchrotron Radiation Facility (ESRF)
decommissioning costs associated with the dismantling of the facility and infrastructures.
Decommissioning occurs on winding up of ESRF. If exit by the UK (or any other Member)
results in ESRF being wound up, the Members are required to arrange for decommissioning of
ESRF’s plant and buildings and to meet the costs of doing so in proportion to their share of
capital at the time of dissolution. The contingent liability is estimated to be £1.8 million.
UKRI – (STFC)
Reprocessing and staff
commitments
(£11.8 million)
A contingent liability exists in respect of the Science and Technology Facilities Council (STFC)’s
share of Institut Laue-Langevin (ILL) unfunded provisions for staff related costs (e.g. early
retirement) and costs associated with reprocessing fuel elements. The contingent liability is
estimated to be £11.8 million (31 March 2019: £13.6 million).
UKRI – Tax Status
change (£45 million)
Prior to the creation of UKRI, the Research Councils paid levels of tax consistent with
charitable status, although they were not registered as charities. HMRC have confirmed that,
due to changes in legislation, the Research Councils should not have been applying charitable
tax reliefs after 1 April 2012 without registering as charities. To this end, UKRI has included
£19.6 million of VAT and £4.1 million of Corporation Tax within their financial statements in
respect of changes from HMRC for prior periods. In due course, UKRI will need to consider
whether it should contact local authorities regarding charitable reliefs on business rates
claimed by the Research Councils from 1 April 2012 to 31 March 2018. The maximum value of
the contingent liability in respect of business rates is estimated to be £45 million.
24. Contingent assets
Core Department
The Core Department has the following contingent assets:
Basis of Recognition
Description
Quantifiable
Core Department – Deed
Relating to the British
Coal Staff
Superannuation Scheme
(BCSSS) under
Paragraph 2(9) of
Schedule 5 to the Coal
Industry Act 1994
(£1.8 billion)
Within twelve months of 31 March 2033, the trustee of the BCSSS shall pay to ‘the Guarantor’
(the Secretary of State) any surplus remaining on the scheme net of any amount retained for
the obligation. The value of the surplus will depend on the value of scheme assets in relation to
outstanding obligations. Based on the Government Actuary’s estimate of a £1.8 billion surplus
as at 31 March 2018, the Department considers a receipt from the scheme to be probable.

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Annual report and accounts 2019-20
Departmental Group
The Departmental Group has the following contingent assets:
Basis of Recognition
Description
Unquantifiable
Coal Authority –
Restructuring Schemes
By virtue of the seventh and ninth Coal Authority Restructuring Schemes (CARS 7 and 9) the
Coal Authority is the beneficiary of restrictive covenants and clawback provisions relating to
land and properties sold by the British Coal Corporation. In the event that the purchasers are
able to retrospectively secure added value by obtaining planning consent for alternative uses
the Authority will receive a share of the added value. Quantification of this asset is not possible.
25. Related-party transactions
The Core Department is the parent of the bodies listed in note 27 ‘List of bodies within the
Departmental Group’ – these bodies are regarded as related parties and various material transactions
have taken place during the reporting period between members of the Departmental Group.
The related parties of the consolidating bodies are disclosed in their respective accounts. The Core
Department is also the sponsor of Companies House, UK Intellectual Property Office (UKIPO),
Met Office (Trading Funds), Ordnance Survey, NPL Management Limited, NNL Holdings Limited and
British Nuclear Fuels.
The Core Department has had various material transactions with other government departments,
government bodies and devolved administrations comprising the Northern Ireland Executive,
Scottish Government and Welsh Government. The most significant of these transactions have been
HM Treasury, Post Office, United Kingdom Research and Innovation, Nuclear Decommissioning
Authority, HM Treasury’s consolidated fund and UK Space Agency.
No minister, board member, key manager of the Departmental Group or other related party have
undertaken any material transactions with the Core Department during the year. Details of the
Department’s ministers and senior managers are shown in the Remuneration Report.
A former Director General of the Core Department, Sarah Harrison, is an unpaid Non-Executive
Director of the Government Property Agency which is an executive agency of the Cabinet Office and
from which the Department leases the majority of its office accommodation.
In the course of allocating funding during the year, UKRI entered into material transactions with various
Higher Education Institutions. Where these bodies have board members who are also members of
university councils, each body operates a policy that precludes interested parties from voting on the
funding to the university in which they have an interest. Further details of these transactions can be
found in statutory accounts of UKRI.
26. Restatement of Statement of Financial Position and
Statement of Comprehensive Net Expenditure as a result
of changes to the Departmental boundary and other
restatements
Prior period adjustments
BIS (Postal Services Act 2001) Company Limited (BPSA)
With the adoption of IFRS 9 ‘Financial Instruments’, all investment classifications and accounting
judgments were re-assessed by BPSA. As a result of this, the unit of account of the investments held
by BPSA was reassessed which led to changes in the recognition of investment movements and
investment returns in the BPSA audited 2018-19 financial statements.

215
Financial Statements
These changes were identified after the 2018-19 Departmental Group accounts had been signed
and laid in Parliament. The overall impact is an increase in the Departmental Group’s net assets of
£7 million.
The disclosure impact in the SoFP was an increase in Other financial assets by £20 million (note 11).
This was driven by:
• a reduction in Investment fund additions of £5 million,
• a reduction in Investment fund repayments of £101 million,
• a reduction in Investment fund revaluations of £82 million, and;
• an adjustment resulting from the adoption of IFRS 9 of £6 million.
The increase in Other financial assets of £20 million was partially offset by a reduction in Cash and
cash equivalents of £10 million (note 16) and Trade and other receivables of £3 million (note 14).
The disclosure impact in the SoCNE was to recognise an increase of £80 million in the change in fair
value of financial assets (note 5) and a decrease in Other operating expenditure of £32 million relating
to profit on disposal of investments, off-set against an increase of £119 million of dividend and
distribution from investment fund income (note 6.2).
As the disclosure impacts are material to the Departmental Group accounts, the Departmental
Group’s comparatives have been restated in the 2019-20 Departmental Annual Report and Accounts.
Had these adjustments been recognised in the Departmental Group Outturn in 2018-19, this would
not have resulted in a control total breach. The Departmental Group Outturn adjustments are
disclosed as a non-budget adjustment in 2019-20 SoPS and are broken down as follows: Note: HM
Treasury’s Supply Estimate guidance manual requires that only increases in Outturn require non-
budget cover in the 2019-20 Supplementary Estimate. The non-budget Outturn includes the
decreases.
Change in budgets and non-budget
Increases/(decrease) in
Outturn
£’000
2018-19 – Capital AME – Government as Shareholder (ALB) net
104,256
2018-19 – Resource AME – Government as Shareholder (ALB) net
(39,661)
2018-19 – Resource DEL – Government as Shareholder (ALB) net
£10k increase in Admin (£1,255k) decrease in Programme
(1,245)
Overall movement
63,350
Fleetbank Funding Limited (Fleetbank)
Fleetbank holds the Enable loan investments, and from 1 April 2016 was consolidated into the
Departmental Group accounts. It was identified that the investment additions (Capital DEL) of
£141 million were incorrectly coded to non-budget spend in the Departmental Group Outturn in
2018-19. This adjustment has no impact on the presentation of the Departmental Group SoFP or
SoCNE but does impact the SoPS as it is an increase in the Departmental Group’s Capital DEL
Outturn. Had this adjustment been recognised in the Departmental Group’s Outturn in 2018-19,
this would not have resulted in a control total breach. The Departmental Group Outturn cumulative
adjustments are disclosed as a non-budget adjustment in 2019-20 SoPS and are broken down
as follows:
Change in budgets and non-budget
Increases/(decrease) in
Outturn
£’000
2016-17 – Capital DEL – Government as Shareholder (ALB) net
29,754
2017-18 – Capital DEL – Government as Shareholder (ALB) net
65,858
2018-19 – Capital DEL – Government as Shareholder (ALB) net
140,804
Overall movement
236,416

216
Annual report and accounts 2019-20
Impact of restatements on opening balances for the Departmental
Group at 1 April 2019
Balance at 31
March 2019
per 2018-19
published
accounts
Prior period
adjustments
Restated
balance at 1
April 2019
£m
£m
£m
Consolidated Statement of Comprehensive Net Expenditure
Operating Income
(3,260)
-
(3,260)
Operating Expenditure
(84,817)
32
(84,785)
Net expenditure for the year from continuing operations
(6,283)
(39)
(6,322)
Other comprehensive net income and expenditure
(191)
–
(191)
Total comprehensive expenditure
(94,551)
(7)
(94,558)
Consolidated Statement of Financial Position
Non-current assets
Property, plant and equipment
3,533
–
3,533
Investment properties
117
–
117
Intangible assets
167
–
167
Investments and loans in public bodies
1,758
–
1,758
Other financial assets
4,098
20
4,118
Recoverable contract costs
1,620
–
1,620
Derivative financial instruments
7
–
7
Investment in joint ventures and associates
1,039
–
1,039
Trade and other receivables
938
–
938
Current assets
Inventories
37
–
37
Non-current assets held for sale
20
–
20
Trade and other receivables
1,568
(3)
1,565
Investments and loans in public bodies
620
–
620
Derivative financial instruments
17
–
17
Cash and cash equivalents
2,088
(10)
2,078
Current liabilities
(8,726)
–
(8,726)
Non-current liabilities
(148,380)
–
(148,380)
Taxpayer's equity and other reserves
General fund
142,304
(7)
142,297
Revaluation reserve
(2,155)
–
(2,155)
Charitable funds
(438)
–
(438)
Non-controlling interests
(232)
–
(232)

217
Financial Statements
27. List of bodies within the Departmental Group
The table below shows the list of BEIS organisations that are included in the Government Resources
and Accounts Act 2000 (Estimates and Accounts) Order 2019, known as the Designation Order, plus
amendments from the Government Resources and Accounts Act 2000 (Estimate and Accounts)
(Amendment) Order 2020, known as the Amendment Order. The individual Annual Report and
Accounts for each of these bodies can be found on their own websites or via the Inside Government
website (https://www.gov.uk/government/organisations/department-for-business-energy-and-
industrial-strategy).
The bodies whose accounts have been consolidated within the Departmental Group accounts are
shown in section (a) of the table. Bodies within the Departmental Group but not consolidated, such as
where net assets are not considered material to the Departmental Group accounts, are indicated
separately in section (b) of this table.
As a result of changes made in the 2019-20 Designation Order and Amendment Order some
additional bodies are now included in the Departmental Group accounts boundary. Where boundary
changes have an impact on previously reported financial results, these are shown in note 26.
Designated Body
(linked bodies are indicated in
italics below their parent body)
Status
Notes and website
(further information about linked bodies or those closed
during the year is also included)
(a) Bodies consolidated in Departmental Group accounts for 2019-20
Agencies
Insolvency Service
Executive Agency
gov.uk/government/organisations/insolvency-service
UK Space Agency
Executive Agency
gov.uk/government/organisations/uk-space-agency
NDPBs and other designated bodies2
Advisory, Conciliation and
Arbitration Service1
NDPB
acas.org.uk
Central Arbitration Committee
NDPB (linked to ACAS)
Consolidated by ACAS
Certification Office for Trade Union
and Employers’ Associations
Other Public Body - Office
Holder (linked to ACAS)
Consolidated by ACAS
BIS (Postal Services Act 2011)
Company Limited
Other Public Body –
Limited Company
beta.companieshouse.gov.uk/company/xx-xxxx-xxxx
British Business Bank plc
Other Public Body – Public
Limited Company
british-business-bank.co.uk
BBB Patient Capital Holdings
Limited
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
British Business Investments Ltd
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
British Business Finance Ltd
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
British Business Financial
Services Ltd
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
British Business Aspire Holdco Ltd
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
British Patient Capital Limited
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
Capital for Enterprise Fund
Managers Limited
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
Capital for Enterprise (GP) Limited
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
Capital for Enterprise Limited
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc

218
Annual report and accounts 2019-20
Designated Body
(linked bodies are indicated in
italics below their parent body)
Status
Notes and website
(further information about linked bodies or those closed
during the year is also included)
The Start-Up Loans Company
Limited Company
(Subsidary of BBB)
Consolidated by British Business Bank plc
Civil Nuclear Police Authority1
NDPB
gov.uk/government/organisations/civil-nuclear-police-
authority
Coal Authority1
NDPB
gov.uk/government/organisations/the-coal-authority
Committee on Fuel Poverty
NDPB
gov.uk/government/organisations/committee-on-fuel-
poverty
Costs are included in the Core Department’s
expenditure.
Committee on Radioactive Waste
Management
NDPB
gov.uk/government/organisations/committee-on-
radioactive-waste-management
Costs are included in the Core Department’s
expenditure.
Competition Service
NDPB
catribunal.org.uk/about/competition-service
Competition Appeal Tribunal
NDPB
catribunal.org.uk
The Copyright Tribunal
NDPB
gov.uk/government/organisations/copyright-tribunal
No accounts produced as costs are included in the
Core Department’s expenditure. It is funded by the
Core Department and operated by UK Intellectual
Property Office.
Cornwall and Isles of Scilly
Investments Limited
Other Public Body –
Limited Company
ciosif.co.uk
Council for Science and
Technology
Expert Committee
gov.uk/government/organisations/council-for-science-
and-technology
No accounts produced as costs are included in the
Core Department’s expenditure.
Diamond Light Source Limited
Other Public Body –
Limited Company
diamond.ac.uk
Dounreay Site Restoration Limited
Limited Company – NDA
Site Licence Company
dounreay.com
Site Licence Company – private company, which
operates sites on behalf of, and under contract from
the NDA.
Enrichment Holdings Ltd
Other Public Body –
Limited Company
This is a special purpose vehicle for the Government’s
investment in Urenco Limited.
Enrichment Investments Limited
Limited Company
(Subsidary of Enrichment
Holdings Limited)
Consolidated by Enrichment Holdings Limited
Electricity Settlements
Company Ltd
Other Public Body –
Limited Company
emrsettlement.co.uk
Fleetbank Funding Limited
Other Public Body –
Limited Company
This is a vehicle for the government to facilitate the
Enable Loan Guarantee Scheme
The Financial Reporting Council
Limited
Other Public Body –
Limited Company
frc.org.uk
Harwell Science and Innovation
Campus Public Sector Limited
Partnership
Other Public Body –
Limited Partnership
Joint venture owned by UKRI and UK Atomic Energy
Authority

219
Financial Statements
Designated Body
(linked bodies are indicated in
italics below their parent body)
Status
Notes and website
(further information about linked bodies or those closed
during the year is also included)
Industrial Development Advisory
Board
Expert Committee
gov.uk/government/organisations/industrial-
development-advisory-board
No accounts produced. Funded by the Core
Department and operated by the Insolvency Service.
Costs are included as part of the Core Department.
LLW Repository Limited
Limited Company – NDA
Site Licence Company
llwrsite.com
Site Licence Company – private company, which
operates sites on behalf of, and under contract from
the NDA.
Low Carbon Contracts Company
Ltd
Other Public Body –
Limited Company
lowcarboncontracts.uk
Low Pay Commission
NDPB
gov.uk/government/organisations/low-pay-commission
No accounts produced as costs are included in the
Core Department’s expenditure
Midlands Engine Investments
Limited
Other Public Body –
Limited Company
british-business-bank.co.uk/ourpartners/midlands-
engine-investment-fund
The NESTA Trust
Other Public Body –
Charitable Trust
nesta.org.uk/faqs/what_is_the_nesta_trust
Northern Powerhouse
Investments Limited
Other Public Body –
Limited Company
british-business-bank.co.uk/ourpartners/northern-
powerhouse-investment-fund
Nuclear Decommissioning
Authority1
NDPB
gov.uk/government/organisations/nuclear-
decommissioning-authority
Magnox Limited3
Limited Company
(Subsidary of NDA)
From 1 September 2019, consolidated by the Nuclear
Decommissioning Authority. Prior to 1 September 2019,
a company operating sites on behalf of, and under
contract from the NDA.
Radioactive Waste Management
Limited
Limited Company
(Subsidary of NDA)
Consolidated by Nuclear Decommissioning Authority
Sellafield Limited
Limited Company
(Subsidary of NDA)
sellafieldsites.com
Site Licence Company – company which operates sites
on behalf of, and under contract from the NDA.
Nuclear Liabilities Financing
Assurance Board
Expert Committee
gov.uk/government/organisations/nuclear-liabilities-
financing-assurance-board
Costs are included in the Core Department’s
expenditure.
Office of Manpower Economics1
Office of Department
gov.uk/government/organisations/office-of-manpower-
economics
No accounts produced as costs are included in the
Core Department’s expenditure.
Oil and Gas Authority
Other Public Body –
Limited Company
ogauthority.co.uk
Postal Services Holding Company
Limited
Other Public Body –
Limited Company
Company in liquidation. Former holding company for the
government’s investment in Post Office Limited.
Regulatory Policy Committee
NDPB
gov.uk/government/organisations/regulatory-policy-
committee
No accounts produced as costs are included in the
Core Department’s expenditure.

220
Annual report and accounts 2019-20
Designated Body
(linked bodies are indicated in
italics below their parent body)
Status
Notes and website
(further information about linked bodies or those closed
during the year is also included)
South Tees Site Company Limited
Other Public Body –
Limited Company
https://www.southteesdc.com/about-us/south-tees-
site-company-ltd
This is a vehicle for managing the government
investment in the South Tees Site
UK Climate Investments LLP
Other Public Body –
Limited Liability
Partnership
greeninvestmentgroup.com/ukci
Limited Liability Partnership between BEIS and UK
Green Investment Bank
UK Climate Investments Apollo
Limited
Limited Company
(Subsidary of UKCI)
Consolidated by the UK Climate Investments LLP
UK Climate Investments H1
Limited
Limited Company
(Subsidary of UKCI)
Consolidated by the UK Climate Investments LLP
UK Climate Investments Indigo
Limited
Limited Company
(Subsidary of UKCI)
Consolidated by the UK Climate Investments LLP
UK Climate Investments Lakeside
Limited
Limited Company
(Subsidary of UKCI)
Consolidated by the UK Climate Investments LLP
UK Climate Investments VC
Limited
Limited Company
(Subsidary of UKCI)
Consolidated by the UK Climate Investments LLP
UK Green Infrastructure Platform
Limited
Other Public Body –
Limited Company
Investment vehicle managed by UK Green Investment
Bank Limited on behalf of BEIS.
United Kingdom Research and
Innovation
NDPB
ukri.org
Medical Research Council1
Part of UKRI
Former Research Council now part of UKRI
The Science and Technology
Facilities Council (STFC)1,4
Part of UKRI
Former Research Council now part of UKRI
Innovate UK Loans Limited
Limited Company
(Subsidary of UKRI)
Consolidated by UKRI
STFC Innovations Limited
Limited Company
(Subsidary of UKRI)
Consolidated by UKRI
UK Shared Business Services
Limited
Other Public Body –
Limited Company
uksbs.co.uk
United Kingdom Atomic Energy
Authority1
NDPB
gov.uk/government/organisations/uk-atomic-energy-
authority (corporate)
ccfe.ukaea.uk (fusion research)
AEA Insurance Limited
Part of UKAEA
Consolidated by United Kingdom Atomic Energy
Authority
(b) Bodies not consolidated in Departmental Group accounts for 2019-20
British Hallmarking Council
NDPB
gov.uk/government/organisations/british-hallmarking-
council
Turnover and net assets are not material to
Departmental Group accounts.
British Technology Investments
Limited
Other Public Body –
Limited Company
Turnover and net assets are not material to
Departmental Group accounts.
Committee on Climate Change1
NDPB
theccc.org.uk/about
Turnover and net assets are not material to
Departmental Group accounts.

221
Financial Statements
Designated Body
(linked bodies are indicated in
italics below their parent body)
Status
Notes and website
(further information about linked bodies or those closed
during the year is also included)
Daresbury SIC (PubSec) LLP
Other Public Body –
Limited Liability
Partnership
https://beta.companieshouse.gov.uk/company/
OC360004
A joint venture between the Science and Technology
Facilities Council (UKRI) and Halton Borough Council.
Turnover and net assets are not material to
Departmental Group accounts.
Daresbury Science & Innovation
Campus Limited5
Other Public Body –
Limited Company
www.sci-techdaresbury.com
A joint venture between the Science and Technology
Facilities Council (UKRI) and Langtree. Turnover and net
assets are not material to Departmental Group accounts.
East Midlands Early Growth Fund
Limited
Other Public Body –
Limited Company
Recorded as investment in Core Department accounts.
Turnover and net assets are not material to
Departmental Group accounts.
Groceries Code Adjudicator
Other Public Body – Office
Holder
gov.uk/government/organisations/groceries-code-
adjudicator
Turnover and net assets are not material to
Departmental Group accounts.
NDA Archives Limited
Other Public Body –
Subsidary of NDA –
Limited Company
Part of the NDA – gov.uk/government/organisations/
nuclear-decommissioning-authority
Turnover and net assets are not material to
Departmental Group accounts.
NW VCLF HF LLP
Other Public Body –
Limited Liability
Partnership
Recorded as investment in Core Department accounts.
Turnover and net assets are not material to
Departmental Group accounts.
Pubs Code Adjudicator
Other Public Body – Office
Holder
gov.uk/government/organisations/pubs-code-
adjudicator
Turnover and net assets are not material to
Departmental Group accounts.
Research Sites Restoration
Limited
Other Public Body –
Subsidary of NDA –
Limited Company
Part of the NDA – Dormant – Site Licence Company
No costs or activities incurred in 2019-20 as the
activities transferred to Magnox in 2016-17.
Small Business Commissioner
NDPB
https://www.smallbusinesscommissioner.gov.uk
Turnover and net assets are not material to
Departmental Group accounts.
Notes:
1. Entities fall in scope of the Trade Union (Facility Time Publication Requirements) Regulations 2017.
Disclosure regarding Facility Time can be found in the relevant accounts.
2. During 2018-19 the Office of National Statistics (ONS) reclassified two of the Department’s non-consolidated
Executive Agencies, HM Land Registry and Companies House, from Public Corporations to Central
Government Bodies. This reclassification will result in Companies House being consolidated into the
Departmental Group accounts from 1 April 2020. HM Land Registry will not be consolidated into the
Departmental Group accounts as it has been classified by Cabinet Office as a Non-Ministerial Department
having a separate Estimate to the Department and preparing its own separate accounts. The Department
has received a derogation from HM Treasury to not consolidate Companies House until its Trading Fund
status is revoked in Parliament. Companies House’s Trading Fund Revocation Order has been laid in
Parliament and has an effective date of 1 April 2020. Companies House will be consolidated into the
2020-21 Departmental Accounts.
3. Magnox Ltd became a wholly owned subsidiary of the Nuclear Decommissioning Authority (NDA) on
1 September 2019.
4. The Science and Technology Facilities Council ceased to exist as of 30 March 2020.
5. Daresbury Science & Innovation Campus Limited was dissolved via voluntary strike off on 31 March 2020.

222
Annual report and accounts 2019-20
28. Events after the Reporting Period
Adjusting events
The Small Business Grant Fund and the Retail, Hospitality and Leisure Grant Fund schemes closed to
new applicants from the end of August 2020, limiting the Department’s liability. Local Authorities
provide weekly updates of payments made under the schemes, which has materially changed the
total liability for the Department. Note 18.2 includes a provision of £10.8 billion relating to the
expected outflow of cash to eligible businesses, in addition to the £151 million recognised as a grant
accrual.
The total cash paid by Local Authorities to businesses as at 16 August 2020 was £10.9 billion. Further
unaudited information on the spend can be found on the gov.uk website https://www.gov.uk/
government/publications/coronavirus-grant-funding-local-authority-payments-to-small-and-medium-
businesses
Non-adjusting events
The Nuclear Liabilities Fund was established in 1996 to meet certain costs of decommissioning eight
nuclear power plants in the UK that have been owned and operated by EDF Energy Nuclear
Generation Limited since 2009. Following discussion between HM Treasury and the Fund, on 23 June
2020 the Fund agreed to retain an existing deposit of £6.5 billion in the UK Exchequer in return for a
contribution of £5.07 billion from the Core Department which will also be held by the Fund as a
deposit in the Exchequer. The contribution by the Department was not related to any change in the
Department’s assessment, as described in note 23, of the sufficiency of the Fund to meet the
decommissioning liabilities prior to the Fund’s agreement to retain its deposit in the Exchequer.
On 3 July 2020, the Government announced that it led a successful bid to acquire OneWeb, which
develops cutting-edge satellite technology in the UK and in the US. The Core Department for the
Business, Energy and Industrial Strategy will invest $500 million and take a significant equity share in
OneWeb.
Due to the COVID-19 pandemic, the government announced a number of support schemes for
businesses. These schemes do not have a financial impact on the 2019-20 financial statements,
unless otherwise stated.
The Coronavirus Business Interruption Loans (CBILS) were announced by the Chancellor on 11 March
2020. This scheme provides term loans, overdrafts, invoice finance and asset finance up to £5 million
with an 80% guarantee to lenders. The Government will make a Business Interruption Payment to
cover the first 12 months of interest payments and any lender-levied charges. The scheme is available
for businesses with a turnover up to £45 million. The term loans and asset facilities are for up to six
years, whilst the overdrafts and invoice finance facilities are up to three years. Post year end, the
terms associated with businesses meeting the criteria of whether they qualify for the loans have been
relaxed meaning even more smaller businesses across the UK can access finance. Access has been
opened up to those smaller businesses that would have previously met the requirements for a
commercial facility, with insufficient security no longer a condition to access the scheme. As at 18
August 2020, £10.5 billion of loans have been provided under the scheme. The maximum amount
that could be paid out if all loans defaulted is £8.4 billion. Not all loans are expected to default, with
losses estimated as at September 2020 to be in a range of 10-25%. The initial indicative loss ranges
are based on historic losses observed in prior programmes which most closely resemble the current
COVID-19 interventions. However, no two programmes (or two economic downturns) are completely
alike and the estimate will be revised as more data becomes available. This data will be used as an
input into the loss forecasting models, which are currently being developed. Actual losses could be
significantly different to forecast losses.
The Coronavirus Large Business Interruption Loan Scheme (CLBILS) supports large businesses to
access loans, overdrafts and other finance, through an 80% guarantee to lenders. Businesses with an
annual turnover over £45 million can apply for up to £200 million of finance, capped at the higher of
25% of turnover, twice the annual wage bill, or need for 12 months liquidity. The maximum term length
is three years. As at 18 August 2020, £1.4 billion of loans have been provided under the scheme. The

223
Financial Statements
maximum amount that could be paid out if all loans defaulted is £1.1 billion. Not all loans are expected
to default, with losses estimated as at September 2020 to be in a range of 5-20%. The initial
indicative loss ranges are based on historic losses observed in prior programmes which most closely
resemble the current COVID-19 interventions. However, no two programmes (or two economic
downturns) are completely alike and the estimate will be revised as more data becomes available. This
data will be used as an input into the loss forecasting models, which are currently being developed.
Actual losses could be significantly different to forecast losses.
The Bounce Back Loan Scheme (BBLS) provides loans to businesses of up to £50,000 (interest and
repayment free for the first 12 months paid for by a Business Interruption Payment grant), with a
100% government-backed guarantee for lenders. These loans have a term length of six years. As at
18 August 2020, £34.2 billion of loans have been provided under the scheme. The maximum amount
that could be paid out if all loans defaulted is £34.2 billion. Not all loans are expected to default, with
losses estimated as at September 2020 to be in a range of 35-60%. The initial indicative loss ranges
are based on historic losses observed in prior programmes which most closely resemble the current
COVID-19 interventions. However, no two programmes (or two economic downturns) are completely
alike and the estimate will be revised as more data becomes available. This data will be used as an
input into the loss forecasting models, which are currently being developed. Actual losses could be
significantly different to forecast losses.
The Future Fund scheme issues convertible loans of between £125,000 and £5 million to innovative
companies which are facing financing difficulties due to COVID-19. Each loan requires at least equal
match funding from private investors and can be converted into equity in the company once the loan
matures. As at 16 August 2020, £588.3 million of loans have been approved to 590 companies.
The Local Authority Discretionary Grants Fund was announced on 2 May 2020 and provides Local
Authorities with grant funding for small businesses up to £617 million.
The Vaccines Taskforce was launched on 17 April 2020 to drive forward, expedite and co-ordinate
efforts to research and then produce a coronavirus vaccine. The Department’s role is to identify and
procure a portfolio of vaccine candidates including supporting vaccine manufacture, so that a vaccine
can be secured and made available to the public as soon as possible. As a result, the Department has
entered into a number of commercially sensitive contracts.
28.1 Date Accounts authorised for issue
BEIS’s Accounting Officer has authorised these Accounts to be issued on the same day as they
were certified.

224
Annual report and accounts 2019-20
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Trust
Statement

226
Annual report and accounts 2019-20
Foreword by the Accounting Officer
Overview
The Trust Statement accounts for the income
BEIS collects as an agent of the HMT
Consolidated Fund. The amounts collected are
passed to the Consolidated Fund. In 2019-20,
BEIS collected income under the following
schemes.
• EU emissions trading scheme (EU ETS)
• Carbon reduction commitment (CRC)
• Climate change agreements (CCA)
• Energy saving opportunity scheme (ESOS)
EU ETS
About EU ETS
EU ETS is the largest emissions trading system
to reduce GHG emissions; around 1,000
industrial plants in the UK participate in the
system. It is a cap and trade system. It caps the
amount of GHG emissions participants can emit;
it allows trading of allowances so that total
emissions stay within the cap. There are
separate emission allowances for stationary
installations and aircraft operators. EU
allowances (EUA), while EU aviation allowances
(EUAA) are allowances for aircraft operators.
Throughout 2019, UK’s access to the EU ETS
registry was suspended as part of Brexit
preparations. During this period the UK was
unable to issue free allowances or hold national
auctions. The suspension was lifted on 31 January
2020 when the UK and EU ratified the withdrawal
agreement. Free allowances relating to 2019 and
2020 were issued to UK operators in February
2020, and UK auctions resumed in March 2020.
EU ETS financial summary
• In March 2020, the UK held two EUA auctions.
• 261 civil penalties were issued by the
Environment Agency, regulator for stationary
installations in England. Most of the penalties
relate to non-compliance within the UK small
emitter opt-out scheme. A penalty is charged
for each tonne of CO2 beyond the target.
Some of these penalties relate to previous
compliance years.
• 4 penalties were issued by OPRED, regulator
for the offshore industry. The sanctions relate
to failures to surrender allowances and to
comply with a permit condition.
CRC
About CRC
CRC is an energy efficiency scheme, mandatory
for large, non-energy intensive organisations,
using over 6GWh of qualifying electricity. There
are over 5,000 participants across the scheme.
Participants buy allowances for each tonne of
equivalent carbon dioxide emissions.
CRC closed at the end of the 2018-19
compliance year to simplify the landscape for
energy efficiency tax on businesses. July 2019
was the last time participants had to report
under CRC, and in October 2019, surrender
allowances for 2018-19 emissions. In April 2019,
the reporting element of CRC was replaced by
the Streamlined Energy and Carbon Reporting
(SECR) framework.
2019-20 saw the fifth buy-to-comply sale (for
compliance year 2018-19). The prices across the
scheme are as follows;
CRC scheme year
Compliance
sale price
Forecast sale
price
2018-19
£18.30
£17.20
2017-18
£17.70
£16.60
2016-17
£17.20
£16.10
2015-16
£16.90
£15.60
2014-15
£16.40
£15.60
CRC financial summary
• CRC allowance sales in 2019-20 generated
£280 million (2018-19: £440 million). There
were 40 civil penalties levied against CRC
participants.
• Civil penalties amounted to £249,078
(2018‑19: £69,090). The costs incurred in
administering the CRC scheme were borne by
the Department as shown in note 3 and
included within the Department’s Accounts.

227
Trust Statement
CCA
About CCA
CCA is an energy efficiency scheme which is
voluntary for businesses in energy intensive
sectors. CCA is an agreement to meet stretching
targets in exchange for a reduced Climate
Change Levy (CCL) of up to 93%. The scheme
was launched in April 2013 and runs until
31 March 2023.
CCA generates income from:
• Charging income: annual payment made by
participants to the Administrator; this is
retained by the Environment Agency and will
not feature in the Trust Statement.
• Civil penalties for minor infractions received by
the Administrator
• Buy-out payments if targets are not met at the
end of the 2-year target period.
CCA financial summary
• In 2019-20, the income from buy-out
payments generated £31.974 million
(£107,760 in 2018-19) – shown in note 2.3 of
the Trust Statement. The higher income in the
current year is because 2019-20 was a period
of primary reporting for Target Reporting
Period III. By comparison, 2018-19 was a
period of secondary reporting for Target
Reporting Period II, where participants make
further top-up buy-out payments after an audit
or they receive a refund if they have overpaid.
• 1 civil penalty was issued under the CCA
scheme totalling £1,602 (2018-19: 2 civil
penalties totalling £565).
ESOS
About ESOS
ESOS is an energy assessment scheme,
mandatory for all large organisations in the UK,
established in response to the EU Energy
Efficiency Directive Article 8 (4-6). Qualifying
organisations must carry out audits every four
years on energy use of their buildings, industrial
processes and transport to identify cost-effective
energy saving measures. The Scheme runs until
5 December 2027. Phase II ran until 5 December
2019, and Phase III runs until 5 December 2023.
In Phase 1 there were 6,075 ultimate parent
organisations in the scheme.
ESOS generates income from non-compliance
penalties.
ESOS financial summary
• In 2019-20, 12 penalties were issued which
totalled £105,725 (2018-19: 28 penalties
which totalled £272,202).
Governance statement
The Department’s governance statement
covers both the Accounts and the Trust
Statement and is included in the Governance
section of this report.
Remote contingent liabilities
Audited information
No remote contingent liabilities exist at the end of
the reporting period.
Basis for preparation
The HM Treasury Accounts Direction, issued in
accordance with Section 2 of the Exchequer and
Audit Departments Act 1921 requires the
Department to prepare the Trust Statement to
give a true and fair view of the state of affairs
relating to the collection and allocation of the
carbon allowance auction receipts for the EU
Emissions Trading Schemes, the allowances
sales from the CRC scheme, buy-out payments
from the CCA Scheme and civil penalties
receivable under the EU ETS, CRC, CCA and
ESOS schemes. Regard is given to all relevant
accounting and disclosure requirements given in
Managing Public Money and other guidance
issued by HM Treasury.
Accounting judgements
As the Accounting Officer, it is my responsibility
to apply suitable accounting policies in the
preparation of the Trust Statement. Revenues are
recognised in the period in which the event that
generates the revenue takes place, consequently
the anticipated proceeds from future auctions
and licences as detailed in note 2 are not
recognised as assets within this statement.
All the transactions within the Trust Statement
reflect transactions that have taken place.
Events after the reporting period
Details of events after the reporting period are
given in note 10 to the Trust Statement.

228
Annual report and accounts 2019-20
Auditors
These financial statements have been audited,
under the Exchequer and Audit Departments Act
1921, by the Comptroller and Auditor General,
who is appointed under statute and reports to
Parliament. The audit opinion is on pages 231 to
233. The auditor’s notional remuneration is
included within the Department’s Accounts.
There were no fees in respect of non-audit work.

229
Trust Statement
Statement of Accounting Officer’s
responsibilities for the Trust Statement
Under section 2 of the Exchequer and Audit
Departments Act 1921, HM Treasury has
directed the Department for Business,
Energy and Industrial Strategy to prepare for
each financial year a Trust Statement in the form
and on the basis set out in the Accounts
Direction.
HM Treasury has appointed the Permanent
Secretary as Accounting Officer of the
Department for Business, Energy and Industrial
Strategy with overall responsibility for preparing
the Trust Statement and for transmitting it to the
Comptroller and Auditor General.
The Accounting Officer is responsible for
ensuring that: there is a high standard of
financial management, including a sound
system of internal control; that financial systems
and procedures promote the efficient and
economical conduct of business and safeguard
financial propriety and regularity; that financial
considerations are fully taken into account in
decisions on policy proposals; and that risk is
considered in relation to assessing value for
money.
The Accounting Officer is responsible for the fair
and efficient administration of the EU ETS
including conducting the auction of EU
Allowances in the UK for Phase III of the Scheme
and Aviation allowances of the EU ETS,
collection of the proceeds and onward
transmission of the funds in their entirety to the
Consolidated Fund.
The Accounting Officer is also responsible for the
collection of CRC Allowances and CCA buy-out
payments for onward transmission to the
Consolidated Fund and, the collection of civil
penalties levied under the EU ETS, CCA, CRC,
and ESOS schemes for onward transmission to
the Consolidated Fund.
The responsibilities of the Accounting Officer,
including responsibility for the propriety and
regularity of the public finances for which an
Accounting Officer is answerable, for keeping
proper records and for safeguarding the
Department’s assets, are set out in Managing
Public Money published by HM Treasury.
The Trust Statement must give a true and fair
view of:
• the statement of affairs of the EU ETS, CCA
Schemes and penalties issued under the EU
ETS, ESOS, CCA and CRC Schemes
These streams of income are recognised on an
accruals basis;
• the state of affairs of the CRC Allowance
Scheme sales which are recognised on a cash
received basis
• the revenue collected, and expenditure
incurred together with the net amounts
surrendered to the Consolidated Fund
In preparing the Trust Statement, the
Accounting Officer is required to comply
with the requirements of the Government
Financial Reporting Manual and in
particular to:
• observe the Accounts Direction issued by
HM Treasury, including the relevant accounting
and disclosure requirements, and apply
suitable accounting policies on a consistent
basis
• make judgements and estimates on a
reasonable basis
• state whether applicable accounting
standards as set out in the Government
Financial Reporting Manual have been
followed, and disclose and explain any
material departures in the accounts
• prepare the Trust Statement on a
going‑concern basis

230
Annual report and accounts 2019-20
Accounting Officer’s confirmation
As the Accounting Officer, I have taken all the
steps that I ought to have taken to make myself
aware of any relevant audit information and to
establish that the Department’s auditors are
aware of that information. So far as I am aware,
there is no relevant audit information of which
the auditors are unaware. The annual report
and accounts as a whole is fair, balanced and
understandable. I take personal responsibility
for the annual report and accounts and the
judgements required for determining that it is fair,
balanced and understandable.
Sarah Munby
Permanent Secretary and
Principal Accounting Officer
11 September 2020

231
Trust Statement
The Trust Statement Audit Report of the
Comptroller and Auditor General to the
House of Commons
Opinion on financial statements
I have audited the financial statements of
Department for Business, Energy and Industrial
Strategy Trust Statement (“the Trust Statement”)
for the year ended 31 March 2020 under the
Exchequer and Audit Departments Act 1921.
The financial statements comprise the Statement
of Revenue, Other Income and Expenditure, the
Statement of Financial Position, the Statement of
Cash Flows and the related notes, including the
significant accounting policies. These financial
statements have been prepared under the
accounting policies set out within them.
In my opinion:
• The Trust Statement gives a true and fair view
of the state of affairs of balances stemming
from: the collection of EU Emissions Trading
Scheme (ETS) auction receipts; Carbon
Reduction Commitment (CRC) allowance
sales; Climate Change Agreements (CCA)
receipts; and EU ETS, CRC, CCA, and Energy
Savings Opportunity Scheme (ESOS) civil
penalties as at 31 March 2020 and of the net
revenue for the year then ended; and
• the financial statements have been properly
prepared in accordance with the Exchequer
and Audit Departments Act 1921 and
HM Treasury directions issued thereunder.
Opinion on regularity
In my opinion, in all material respects the income
and expenditure recorded in the financial
statements have been applied to the purposes
intended by Parliament and the financial
transactions recorded in the financial statements
conform to the authorities which govern them.
Basis of opinions
I conducted my audit in accordance with
International Standards on Auditing (ISAs) (UK)
and Practice Note 10 ‘Audit of Financial
Statements of Public Sector Entities in the United
Kingdom’. My responsibilities under those
standards are further described in the Auditor’s
responsibilities for the audit of the financial
statements section of my certificate. Those
standards require me and my staff to comply
with the Financial Reporting Council’s Revised
Ethical Standard 2016. I am independent of the
Department in accordance with the ethical
requirements that are relevant to my audit and
the financial statements in the UK. My staff and
I have fulfilled our other ethical responsibilities in
accordance with these requirements. I believe
that the audit evidence I have obtained is
sufficient and appropriate to provide a basis for
my opinion.
Conclusions relating to going concern
I have nothing to report in respect of the
following matters in relation to which the ISAs
(UK) require me to report to you where:
• the Department’s use of the going concern
basis of accounting in the preparation of the
financial statements is not appropriate; or
• the Department have not disclosed in the
financial statements any identified material
uncertainties that may cast significant doubt
about the Department’s ability to continue to
adopt the going concern basis of accounting
for a period of at least twelve months from the
date when the financial statements are
authorised for issue.
Responsibilities of the Accounting Officer
for the audit of the financial statements
As explained more fully in the Statement of
Accounting Officer’s Responsibilities for the Trust
Statement, the Accounting Officer is responsible
for the preparation of the financial statements
and for being satisfied that they give a true and
fair view.
Auditor’s responsibilities for the audit of the
financial statements
My responsibility is to audit and report on the
financial statements in accordance with the
Exchequer and Audit Departments Act 1921.
An audit involves obtaining evidence about the
amounts and disclosures in the financial

232
Annual report and accounts 2019-20
statements sufficient to give reasonable
assurance that the financial statements are free
from material misstatement, whether caused by
fraud or error. Reasonable assurance is a high
level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs (UK)
will always detect a material misstatement when
it exists. Misstatements can arise from fraud or
error and are considered material if, individually
or in the aggregate, they could reasonably be
expected to influence the economic decisions of
users taken on the basis of these financial
statements.
As part of an audit in accordance with ISAs (UK),
I exercise professional judgment and maintain
professional scepticism throughout the audit.
I also:
• identify and assess the risks of material
misstatement of the financial statements,
whether due to fraud or error, design and
perform audit procedures responsive to those
risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis
for my opinion. The risk of not detecting a
material misstatement resulting from fraud is
higher than for one resulting from error, as
fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override
of internal control.
• obtain an understanding of internal control
relevant to the audit in order to design audit
procedures that are appropriate in the
circumstances, but not for the purpose of
expressing an opinion on the effectiveness of
the Department’s internal control.
• evaluate the appropriateness of accounting
policies used and the reasonableness of
accounting estimates and related disclosures
made by management.
• evaluate the overall presentation, structure and
content of the financial statements, including
the disclosures, and whether the consolidated
financial statements represent the underlying
transactions and events in a manner that
achieves fair presentation.
• Conclude on the appropriateness of the
Department’s use of the going concern basis
of accounting and, based on the audit
evidence obtained, whether a material
uncertainty exists related to events or
conditions that may cast significant doubt on
the Department’s ability to continue as a going
concern. If I conclude that a material
uncertainty exists, I am required to draw
attention in my report to the related
disclosures in the financial statements or,
if such disclosures are inadequate, to modify
my opinion. My conclusions are based on the
audit evidence obtained up to the date of my
report. However, future events or conditions
may cause the Department to cease to
continue as a going concern.
I communicate with those charged with
governance regarding, among other matters,
the planned scope and timing of the audit and
significant audit findings, including any significant
deficiencies in internal control that I identify
during my audit.
I am required to obtain evidence sufficient to
give reasonable assurance that the income and
expenditure recorded in the financial statements
have been applied to the purposes intended by
Parliament and the financial transactions
recorded in the financial statements conform
to the authorities which govern them.
Other information
The Accounting Officer is responsible for the
other information. The other information
comprises information included in the
Accounting Officer’s foreword to the Trust
Statement and Statement of the Accounting
Officer’s responsibility for the Trust Statement,
but does not include the financial statements and
my auditor’s report thereon. My opinion on the
financial statements does not cover the other
information and I do not express any form of
assurance conclusion thereon. In connection
with my audit of the financial statements, my
responsibility is to read the other information and,
in doing so, consider whether the other
information is materially inconsistent with the
financial statements or my knowledge obtained
in the audit or otherwise appears to be materially
misstated. If, based on the work I have
performed, I conclude that there is a material
misstatement of this other information, I am
required to report that fact. I have nothing to
report in this regard.
Opinion on other matters
In my opinion:
• the information given in the Accounting
Officer’s foreword to the Trust Statement and
Statement of the Accounting Officer’s
responsibility for the Trust Statement for the
financial year for which the financial

233
Trust Statement
statements are prepared is consistent with the
financial statements.
Matters on which I report by exception
I have nothing to report in respect of the
following matters which I report to you if, in my
opinion:
• adequate accounting records have not been
kept or returns adequate for my audit have not
been received from branches not visited by my
staff; or
• the financial statements are not in agreement
with the accounting records and returns; or
• I have not received all of the information and
explanations I require for my audit; or
• the Governance Statement does not reflect
compliance with HM Treasury’s guidance.
Report
I have no observations to make on these
financial statements.
Gareth Davies
Comptroller and Auditor General
National Audit Office
157-197 Buckingham Palace Road
Victoria
London
SW1W 9SP
15 September 2020

234
Annual report and accounts 2019-20
Statement of Revenue, Other income
and Expenditure
for the year ended 31 March 2020
2019-20
2018-19
Note
£’000
£’000
Revenue
License fees and taxes
EU ETS auction income
2.1
201,388
1,270,535
CRC allowance sales
2.2
280,462
440,280
CCA buy-out payments income
2.3
31,974
108
Total licence fees and taxes
513,824
1,710,923
Fines and penalties
Civil penalties – EU ETS
8,485
2,745
Civil penalties – CRC
250
69
Civil penalties – CCA
2
1
Civil penalties – ESOS
106
272
Total fines and penalties
2.4
8,843
3,087
Total revenue and other income
522,667
1,714,010
Expenditure
Foreign exchange and interest – EU ETS
3.1
195
(1,269)
Credit losses – debts written off
3.2
(9)
–
Total expenditure
186
(1,269)
Net revenue for the Consolidated Fund
522,853
1,712,741
There were no recognised gains or losses accounted for outside of the above Statement of Revenue,
Other Income and Expenditure.
The notes on pages 237 to 241 form part of this statement.

235
Trust Statement
Statement of Financial Position
as at 31 March 2020
31 March 2020
31 March 2019
Note
£’000
£’000
Current assets
Receivables and accrued fees
4
9,400
2,797
Cash and cash equivalents
5
33,181
27,898
Total current assets
42,581
30,695
Current liabilities
Payables
6
(639)
(324)
Total current liabilities
(639)
(324)
Net current assets
41,942
30,371
Total net assets
Represented by:
41,942
30,371
Balance on Consolidated Fund Accounts
41,942
30,371
The notes on pages 237 to 241 form part of this statement.
Sarah Munby
Permanent Secretary and
Principal Accounting Officer
11 September 2020

236
Annual report and accounts 2019-20
Statement of Cash Flows
for the year ended 31 March 2020
2019-20
2018-19
Note
£’000
£’000
Net cash flows from operating activities
A
516,565
1,711,335
Cash paid to the Consolidated Fund
7
(511,282)
(1,707,358)
Increase/(decrease) in cash in this period
B
5,283
3,977
Notes to the Statement of Cash Flows
2019-20
2018-19
Note
£’000
£’000
A: Reconciliation of Net Cash Flow to Movement in Net Funds
Net Revenue for the Consolidated Fund
7
522,853
1,712,741
(Increase)/decrease in receivables and accrued fees
4
(6,603)
(1,326)
Increase/(decrease) in payables
6
315
(80)
Net cash flows from operating activities
516,565
1,711,335
B: Analysis in changes in Net Funds
Increase/(decrease) in cash in this period
5,283
3,977
Net Funds as at 1 April (net cash at bank)
5
27,898
23,921
Net Funds as at 31 March (closing balance)
5
33,181
27,898

237
Trust Statement
Notes to the Trust Statement
1. Accounting Policies
1.1 Basis of accounting
The Trust Statement is prepared in accordance
with the accounts direction issued by
HM Treasury under section 2 of the
Exchequer and Audit Departments
Act 1921. The Trust Statement is prepared in
accordance with the accounting policies detailed
below. These have been agreed between the
Department for Business, Energy and Industrial
Strategy (the Department) and HM Treasury and
have been developed in accordance with
International Financial Reporting Standards
(IFRS) and other relevant guidance. The
accounting policies have been applied
consistently in dealing with items considered
material in relation to the accounts.
The income and associated expenditure
contained in the Departmental Trust Statement
are those flows of funds which the Department
administers on behalf of the Consolidated Fund.
The financial information in the Trust Statement is
rounded to the nearest £’000.
The Trust Statement is presented in pounds
sterling, which is the functional currency of the
Department.
1.2 Accounting convention
The Trust Statement has been prepared in
accordance with the historical cost convention.
1.3 Revenue recognition
IFRS 15 ‘Revenue from Contracts with
Customers’ was adopted on 1 April 2018.
This replaced IAS 18 ‘Revenue’ and IAS 11
‘Construction Contracts’. The FReM extends the
definition of a contract under IFRS 15 para 9 to
include legislation and regulations which enable
an entity to obtain revenue that is not classified
as a tax by the Office of National Statistics
(ONS). As both EU ETS auction income and
CRC allowances sales are classified as taxes by
ONS and CCA income meets the definition of
a tax under ONS’s guidance, IFRS 15 is not
applicable to the material revenue streams of
the BEIS Trust Statement.
Income from these schemes is recognised as
follows:
• EU ETS receipts represent proceeds from the
auction of carbon allowances under Phase III
and aviation allowances of the EU ETS.
Revenue is recognised at the close of each
competitive auction, when the revenue can be
measured reliably.
• Revenue in respect of CRC allowance sales
is recognised on a cash received basis by
agreement with HM Treasury.
• Revenue in respect of CCA buy-out payments
is recognised on an accruals basis, albeit the
recognition point is when the income is
received.
• Revenue in respect of civil penalties is
recognised when the penalty is imposed.
All result in a cash flow to the Consolidated
Fund. This has resulted in no difference to the
income recognition methodology applied in
previous years.
CRC participants may request refunds for
over‑surrendered allowances (note 9 Contingent
Liabilities refers). These are accounted for in the
period in which the refund request is authorised
and processed.
1.4 Financial instruments
A financial instrument is any contract that gives
rise to a financial asset of one entity and a
financial liability or equity instrument of another
entity. Financial assets and financial liabilities are
recognised in the Statement of Financial Position
when the Department becomes a party to the
contractual provisions of an instrument.
1.5 Financial assets
For the purposes of this Trust Statement, the
Department holds financial assets in the following
categories:
• Receivables held at amortised cost;
• Cash and cash equivalent.
Both receivables and cash and cash equivalents
are held at amortised cost following the adoption
of IFRS 9 ‘Financial Instruments’ as a
replacement for IAS 39 ‘Financial Instruments:
Recognition and Measurement’ from 1 April

238
Annual report and accounts 2019-20
2018. There were no changes in terms of
measurement for these assets upon transition.
Receivables held at amortised cost comprise:
• for EU ETS the amounts due from primary
participants in respect of established auction
liabilities for which, at the financial year end,
payments had not been received. The
amounts due are calculated at the close of
each auction and have a maturity of less than
three months;
• civil penalties levied against participants in the
EU ETS, ESOS, CCA and CRC schemes,
amounts for which have not been received at
the financial year end.
Cash and cash equivalents comprise current
balances with banks and other financial
institutions, which are readily convertible to
known amounts of cash and which are subject
to insignificant risk of changes in value and have
an original maturity of three months or less.
1.6 Financial liabilities
For the purposes of this Trust Statement the
Department holds financial liabilities in the
following category:
• Other financial liabilities
Other financial liabilities comprise:
• Payables in the Statement of Financial
Position. Payables are amounts established as
due at the reporting date, but where payment
is made subsequently. Since these balances
are expected to be settled within 12 months
of the reporting date there is no material
difference between fair value, amortised cost
and historical cost.
The adoption of IFRS 9 has not had a significant
effect on the Department’s accounting policies
for financial liabilities
1.7 Foreign currency
Transactions that are denominated in a foreign
currency are translated into sterling at the rate of
exchange ruling on the date of each transaction.
Monetary assets and liabilities denominated in
foreign currency at the year-end are translated at
the rates ruling at that date unless a forward rate
has been fixed with the Bank of England. All
translation differences are included in the
Statement of Revenue, Other Income and
Expenditure for the period.

239
Trust Statement
2. Revenue
2.1 Revenue from EU ETS
2019-20
2018-19
£’000
£’000
EU ETS – phase III auctions
income
201,388
1,258,836
EU ETS – aviation auctions
income
–
11,699
Total
201,388
1,270,535
During 2019, the UK’s access to the EU ETS
registry was suspended as part of Brexit
preparations, therefore the UK was unable to
issue free allowances or hold national auctions.
The suspension was lifted on 31 January 2020
when the UK and EU ratified the withdrawal
agreement. Free allowances relating to 2019 and
2020 were issued to UK operators in February
2020, and UK auctions resumed in March 2020.
Auction dates and units auctioned for EUA
Phase III and EUAA, are available on the
Intercontinental Exchange website on the auction
calendar link at www.theice.com/emissions/
auctions
2.2 Revenue from CRC
2019-20
2018-19
£’000
£’000
CRC allowance sales
280,462
440,280
Total
280,462
440,280
2.3 Revenue from CCA
2019-20
2018-19
£’000
£’000
CCA buy-out payment
income receivable
31,974
108
Total
31,974
108
In 2019-20, the income from buy-out payments
generated £31.974 million (£107,760 in
2018‑19). This increase is due to 2019-20 being
the primary reporting period income for Target
Reporting Period III. The income for the prior
year comparative is lower due to 2018-19 being
a period of secondary reporting for Target
Reporting Period ll which entailed top up
payments as a result of audit or refunds only.
2.4 Revenue from civil penalties
2019-20
2018-19
£’000
£’000
Levied under EU ETS
8,485
2,745
Levied under CRC
250
69
Levied under CCA
2
1
Levied under ESOS
106
272
Total
8,843
3,087
There were 261 penalties totalling £9,277,406
(2018-19: 209 penalties totalling £2,745,088)
levied under the EU ETS scheme. An adjustment
of EU ETS income in relation to prior years has
been included within this figure, resulting in the
net value for EU ETS income being £8,485,007.
There were 40 penalties totalling £249,708
(2018-19: 6 penalties totalling £69,090) levied
under the CRC scheme. 12 penalties totalling
£105,725 (2018-19: 28 penalties totalling
£272,202) were levied under the ESOS scheme.
1 penalty totalling £1,602 (2018-19: 2 penalties
totalling £565) was (were) levied under the
CCA scheme.

240
Annual report and accounts 2019-20
3. Expenditure and
disbursements
3.1 Costs incurred in the
collection of receipts
2019-20
2018-19
£’000
£’000
Foreign currency translation
(gains)/losses – EU ETS
(195)
1,248
Interest charges on Euro
auction bank account –
EU ETS
–
21
Total
(195)
1,269
3.2 Credit losses
2019-20
2018-19
£’000
£’000
De-recognition of ESOS
penalty
9
–
Total
9
–
Expenditure incurred to administer EU ETS,
CRC, CCA and ESOS are provided below. These
costs are included in the BEIS accounts because
there is no express statutory provision to deduct
them from the revenue collected and paid to the
Consolidated Fund.
EU ETS: £1,532,423 (2018-19: £668,113)
CRC: £321,800 (2018-19: £368,211)
CCA: £361,599 (2018-19: £357,643)
ESOS: £1,028,290 (2018-19: £915,405)
4. Receivables and accrued
fees
2019-20
2018-19
£’000
£’000
Civil Penalties receivable
9,400
2,797
Total
9,400
2,797
5. Cash and cash
equivalents
2019-20
2018-19
£’000
£’000
Balance as at 1 April
27,898
23,921
Net change in cash and cash
equivalent balances
5,283
3,977
Balance at 31 March
33,181
27,898
The following balances at
31 March were held at:
Government Banking Service
33,181
27,898
Total
33,181
27,898
6. Payables
2019-20
2018-19
£’000
£’000
Other
639
324
Total
639
324
7. Balance on the
Consolidated Funds
accounts
2019-20
2018-19
£’000
£’000
Balance on the consolidated
Fund as at 1 April
30,371
24,988
Net revenue for the
Consolidated Fund
522,853
1,712,741
Less amounts paid to the
Consolidated Fund
(511,282)
(1,707,358)
Balance on the
Consolidated Fund as at
31 March
41,942
30,371

241
Trust Statement
8. Financial Instruments
8.1 Classification and
categorisation of financial
instruments
2019-20
2018-19
£’000
£’000
Financial assets
Cash
33,181
27,898
Civil penalties receivable
9,400
2,797
Total financial assets
42,581
30,695
Financial liabilities
Other Payables
(639)
(324)
Total financial liabilities
(639)
(324)
8.2 Risk exposure to financial
instruments
EU ETS
EU ETS is exposed to foreign currency risk due
to the timing difference in recognising proceeds
at the auction, and converting proceeds into
Sterling one day after the close of the auction.
This results in either an exchange loss or gain.
As shown in note 3.1 there was an exchange
gain of £194,813 incurred in 2019-20 (2018-19:
loss of £1,247,957).
EU ETS is not exposed to interest rate or
liquidity risk. It’s exposure to market risk is limited
due to there being a current demand for carbon
allowances. Civil penalties are subject to credit
risk, but this risk is assessed by management as
minimal due to the nature of the participants in the
scheme.
CRC
CRC allowance sales are subject to credit risk,
but this risk is assessed by management as low.
This is borne out in the results from previous
years of the scheme. The civil penalties imposed
under CRC are subject to credit risk, but this risk
is assessed by management as minimal due to
the nature of the participants in the scheme.
CCA
CCA buy-out payment revenue is subject to credit
risk, but this risk is assessed by management as
low, due to the nature of participants in the
scheme. All fees under the regime are received in
sterling minimising any other risks.
Information to help evaluate the significance
of financial instruments on the Department’s
financial performance and position and the
nature and extent of the Department’s exposure
to other risks can be found in note 22 to the
Department’s Accounts.
9. Contingent liability
CRC
A contingent liability exists for refunds the
Department may have to pay to CRC
participants who have over-surrendered
allowances. This is as a result of legislation
included in the CRC Order 2013. The refunds are
contingent upon participants being able to prove
the over-surrender was due to a reporting error
and must be agreed by the Secretary of State.
The Department is unable to quantify the amount
of future refunds, but based on the most recent
information available from the scheme
administrators, the refunds are not expected to
be significant. Future refunds will be paid as and
when they fall due out of future scheme receipts.
CCA
A contingent liability exists in the secondary
reporting phase of each Target Reporting Period.
This is where a participant has undergone review
or audit procedures and it is deemed they have
overpaid. Thus, the participant is due a refund.
The department must retain sufficient funds in
order to cover these refunds.
10. Events after the reporting
period
On the 1st June 2020, the UK Emission Trading
scheme was announced, as a result of the UK
leaving the EU ETS scheme at the end of the
year.
There were no other significant events after the
reporting period that require disclosure.
The Accounting Officer has duly authorised the
issue of the Trust Statement on the date of the
Comptroller and Auditor General’s audit
certificate.

242
Annual report and accounts 2019-20
Annex D: Annexes to the Trust
Statement
Accounts Direction given by HM Treasury in
accordance with Section 2 of the Exchequer
and Audit Departments Act 1921
This direction applies to those government
departments listed in appendix 2.
The Department shall prepare a Trust Statement
(“the Statement”) for the financial year ended 31
March 2020 for the revenue and other income,
as directed by the Treasury, collected by the
department as an agent for others, in
compliance with the accounting principles and
disclosure requirements of the edition of the
Government Financial Reporting Manual by HM
Treasury (“FReM”) which is in force for 2019-20.
The Statement shall be prepared, as prescribed
in appendix 1, so as to give a true and fair view
of (a) the state of affairs relating to the collection
and allocation of taxes, licence fees, fines and
penalties and other income by the Department
as agent and of the expenses incurred in the
collection of those taxes, licence fees, fines and
penalties insofar as they can properly be met
from that revenue and other income; (b) the
revenue and expenditure; and (c) the cash flows
for the year then ended.
The Statement shall also be prepared so as to
provide disclosure of any material expenditure or
income that has not been applied to the
purposes intended by Parliament or material
transactions that have not conformed to the
authorities which govern them.
When preparing the Statement, the Department
shall comply with the guidance given in the
FReM (Chapter 8). The Department shall also
agree with HM Treasury the format of the
Principal Accounting Officer’s Foreword to the
Statement, and the supporting notes, and the
accounting policies to be adopted, particularly in
relation to revenue recognition. Regard shall also
be given to all relevant accounting and disclosure
requirements in Managing Public Money and
other guidance issued by HM Treasury, and to
the principles underlying International Financial
Reporting Standards.
Compliance with the requirements of the FReM
will, in all but exceptional circumstances, be
necessary for the accounts to give a true and fair
view. If, in these exceptional circumstances,
compliance with the requirements of the FReM is
inconsistent with the requirement to give a true
and fair view, the requirements of the FReM
should be departed from only to the extent
necessary to give a true and fair view. In such
cases, informed and unbiased judgement should
be used to devise an appropriate alternative
treatment which should be consistent with both
the economic characteristics of the
circumstances concerned and the spirit of the
FReM. Any material departure from the FReM
should be discussed in the first instance with
HM Treasury.
The Statement shall be transmitted to the
Comptroller and Auditor General for the purpose
of his examination and report by a date agreed
with the Comptroller and Auditor General and
HM Treasury to enable compliance with the
administrative deadline for laying the audited
accounts before Parliament before the Summer
Recess.
The Trust Statement, together with this direction
(but with the exception of the related
appendices) and the Report produced by the
Comptroller and Auditor General under section 2
of the Exchequer and Audit Departments Act
1921 shall be laid before Parliament at the same
time as the Department’s Resource Accounts for
the year unless the Treasury have agreed that the
Trust Statement may be laid at a later date.
Vicky Rock
Director, Public Spending
Her Majesty’s Treasury
19 December 2019

243
Trust Statement
Appendix 1: Trust Statement
for the year ended 31 March
2020
1. The Trust Statement shall include:
• a Foreword by the Principal Accounting
Officer
• a Statement of the Principal Accounting
Officer’s Responsibilities
• a Governance Statement
• a Statement of Revenue, Other Income and
Expenditure
• a Statement of Financial Position
• a Cash Flow Statement
• such notes as may be necessary to present
a true and fair view
2. The notes shall include among other items:
• the accounting policies, including the policy
for revenue recognition and estimation
techniques and forecasting techniques
together with statements explaining any
significant uncertainty surrounding
estimates and forecasts
• a breakdown of material items within the
accounts
• any assets, including intangible assets and
contingent liabilities
• summaries of losses, write-offs and
remissions
• post balance sheet events
• any other notes agreed with HM Treasury
and the National Audit Office
Appendix 2: Application of
the accounts direction
Sponsoring
Department Income stream
Responsible
entity
Department for
Business, Energy
and Industrial
Strategy
EU Emissions
Allowance
BEIS
Fines and Penalties
BEIS
CRC allowances
BEIS
Climate Change
Agreements
BEIS

Page intentionally left blank

Annexes

246
Annual report and accounts 2019-20
Annex A: Common core tables
Table 1 – Public spending
This table provides a summary of Departmental net expenditure using the same headings as voted within the Estimate.
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
Outturn
Outturn
Outturn
Outturn
Outturn
Plans
£’000
£’000
£’000
£’000
£’000
£’000
Resource DEL
Deliver an ambitious industrial strategy
433,415
419,912
377,129
182,286
908,525
12,694,436
Maximise investment opportunities and bolster UK interests
19,368
25,651
40,218
70,705
73,225
65,060
Promote competitive markets and responsible business practices
96,204
77,895
106,951
116,245
81,333
194,383
Delivering affordable energy for households and businesses
342,329
36,365
32,381
44,155
38,974
34,268
Ensuring that our energy system is reliable and secure
11,560
5,823
4,201
4,756
4,723
14,240
Taking action on climate change and decarbonisation
95,211
27,236
91,076
24,829
32,518
15,805
Managing our energy legacy safely and responsibly
306,343
291,203
265,752
251,870
234,186
215,461
Science and Research
13,540
(1,985)
5,088
4,608
6,159
3,692
Capability
361,322
307,082
320,301
393,848
415,591
706,293
Government as Shareholder
175,114
152,037
92,179
41,017
36,273
72,738
Deliver an ambitious industrial strategy (ALB) net
–
5,433
15,172
15,147
21,077
43,010
Promote competitive markets and responsible business practices (ALB) net
49,295
48,127
51,648
54,635
54,743
58,340
Ensuring that our energy system is reliable and secure (ALB) net
674
1,707
(1,628)
(2,667)
(2,756)
1
Taking action on climate change and decarbonisation (ALB) net
4,894
2,399
4,834
6,069
8,260
5,136
Managing our energy legacy safely and responsibly (ALB) net
46,977
39,234
34,711
32,075
28,719
25,537
Science and Research (ALB) net
88,406
257,413
234,283
276,226
231,165
279,600
Capability (ALB) net
39,218
39,818
33,635
30,475
34,693
1,500
Government as Shareholder (ALB) net
(30,023)
(34,034)
(73,072)
(20,724)
48,853
991,308
NDA and SLC expenditure (ALB) net
1,414,542
1,287,445
1,254,752
1,175,337
1,330,218
1,382,000
Nuclear Decommissioning Authority Income (CFER)
(974,558)
(1,026,768)
(1,176,795)
(978,373)
(748,104)
(862,000)
Nuclear Safeguards Development
–
–
1,189
(2,275)
–
–
Managing our energy legacy safely and responsibly (CFER)
–
–
–
(475,000)
–
–
Total Resource DEL
2,493,831
1,961,993
1,714,005
1,245,244
2,838,375
15,940,808

247
Annexes
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
Outturn
Outturn
Outturn
Outturn
Outturn
Plans
£’000
£’000
£’000
£’000
£’000
£’000
Of which:
Staff costs
548,832
519,570
533,290
605,821
682,747
*
Purchase of goods and services
2,111,285
1,977,969
1,938,532
1,936,315
3,394,359
*
Income from sales of goods and services
(1,144,381)
(1,172,788)
(1,079,179)
(996,751)
(764,171)
(864,518)
Current grants to local government (net)
25,513
12,055
9,587
22,388
183,159
12,421,000
Current grants to persons and non-profit bodies (net)
548,517
178,351
135,838
133,554
177,281
230,472
Current grants abroad (net)
41,307
58,511
59,465
72,274
51,593
92,734
Subsidies to private sector companies
246,476
274,038
526,638
141,423
100,481
1,124,000
Subsidies to public corporations
183,035
145,239
95,170
61,530
50,081
50,000
Net public service pensions
–
–
(9)
(12)
(13)
–
Rentals
(47,642)
40,608
49,177
37,077
46,630
34,456
Depreciation
268,978
355,397
266,467
310,652
331,470
336,685
Take up of provisions
(30)
780
(165)
–
(32,162)
–
Change in pension scheme liabilities
35
128
1,372
547
579
–
Other resource
(288,094)
(427,865)
(822,178)
(1,079,574)
(1,383,659)
(210,778)
Resource AME
Deliver an ambitious industrial strategy
(7,428)
215,413
17,448
(312,599)
10,733,189
(73,373)
Maximise investment opportunities and bolster UK interests
(457)
1,844
1,586
6,044
701
–
Promote competitive markets and responsible business practices
101,525
134,029
6,171
79,228
72,282
87,133
Ensuring that our energy system is reliable and secure
(309,667)
(3,204)
(415)
(295)
478
–
Taking action on climate change and decarbonisation
841,397
(1,337,205)
–
–
–
–
Managing our energy legacy safely and responsibly
(308,924)
(258,615)
(885,264)
(297,497)
(203,397)
(147,336)
Science and Research
49,871
41,888
45,578
205,985
54,912
70,489
Capability
(21,783)
(6,012)
13,557
(12,990)
(55,895)
(70,681)
Government as Shareholder
(60,043)
(13,342)
(72,885)
807
10,006
28,585
Renewable Heat Incentive
372,420
545,426
687,275
817,898
846,092
1,150,000
Deliver an ambitious industrial strategy (ALB) net
7,741
(10,850)
4,967
(14,444)
36,202
18,000
Promote competitive markets and responsible business practices (ALB) net
(161)
(59)
87
57
973
73
Taking action on climate change and decarbonisation (ALB) net
9,281,975
1,065,496
3,558,227
(2,971,284)
3,543,428
–
Managing our energy legacy safely and responsibly (ALB) net
1,906,630
2,025
1,507,140
(2,022,249)
22,826
117,909
Science and Research (ALB) net
107,287
91,411
94,536
41,299
149,372
10,903
Capability (ALB) net
2
(400)
–
1
4
(535)

248
Annual report and accounts 2019-20
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
Outturn
Outturn
Outturn
Outturn
Outturn
Plans
£’000
£’000
£’000
£’000
£’000
£’000
Government as Shareholder (ALB) net
(56,337)
(26,656)
(25,633)
47,451
(99,851)
11,582,331
Nuclear Decommissioning Authority (ALB) net
89,797,932
2,850,516
69,911,856
(101,791,292)
4,371,679
1,576,000
Promote competitive markets and responsible business practices
254,256
231,511
259,815
319,330
431,123
398,000
Total Resource AME
101,956,236
3,523,216
75,124,046
(105,904,550)
19,914,124
14,747,498
Of which:
Staff costs
–
–
–
4,404
5,165
*
Purchase of goods and services
23,450
36,665
101,425
145,292
164,120
*
Income from sales of goods and services
–
–
–
(3)
(5)
–
Current grants to persons and non-profit bodies (net)
429,826
429,011
353,221
416,439
513,128
587,146
Subsidies to private sector companies
372,420
545,426
687,275
817,898
846,092
1,150,000
Rentals
(81)
(718)
(2,456)
(2,198)
(2,069)
–
Depreciation
10,126,954
59,847
4,397,424
(1,882,868)
5,575,119
46,589
Take up of provisions
91,967,474
2,984,041
71,236,030
(101,359,925)
17,774,375
13,365,248
Release of provision
(692,733)
(352,371)
(316,703)
(3,078,344)
(3,035,901)
(266,243)
Change in pension scheme liabilities
19,199
20,375
34,554
29,717
32,501
–
Unwinding of the discount rate on pension scheme liabilities
37,423
38,095
36,924
37,782
38,348
80
Other resource
(327,696)
(237,155)
(1,403,648)
(1,032,744)
(1,996,749)
(136,622)

Total Resource Budget
104,450,067
5,485,209
76,838,051
(104,659,306)
22,752,499
30,688,306
Of which:
Depreciation
10,395,932
415,244
4,663,891
(1,572,216)
5,906,589
383,274

Capital DEL
Deliver an ambitious industrial strategy
289,783
298,132
142,364
(54,606)
(14,440)
(307,300)
Maximise investment opportunities and bolster UK interests
319,887
303,527
289,791
243,957
265,872
492,100
Promote competitive markets and responsible business practices
(10,906)
1,040
4,751
5,940
6,643
22,623
Delivering affordable energy for households and businesses
131,102
42,201
43,633
32,718
44,502
89,700
Ensuring that our energy system is reliable and secure
5,071
(548)
60
(626)
291
300
Taking action on climate change and decarbonisation
54,871
39,569
51,578
73,121
154,227
440,570
Managing our energy legacy safely and responsibly
5,017
7,747
7,944
4,278
3,461
–
Science and Research
442,991
2,596,657
2,634,812
563,177
691,794
1,789,689
Capability
11,929
10,181
18,777
30,305
19,703
153,679
Government as Shareholder
225,668
7,871
(98,418)
172,613
61,445
25,545
Deliver an ambitious industrial strategy (ALB) net
–
5
32
–
–
–

249
Annexes
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
Outturn
Outturn
Outturn
Outturn
Outturn
Plans
£’000
£’000
£’000
£’000
£’000
£’000
Promote competitive markets and responsible business practices (ALB) net
940
1,027
1,377
1,059
1,193
1,160
Ensuring that our energy system is reliable and secure (ALB) net
975
1,005
–
–
–
–
Taking action on climate change and decarbonisation (ALB) net
959
601
39
255
27
275
Managing our energy legacy safely and responsibly (ALB) net
12,243
8,778
13,559
9,503
12,919
11,600
Science and Research (ALB) net
6,260,785
4,257,684
4,761,522
7,530,042
7,786,590
8,131,694
Capability (ALB) net
641
480
43
2,482
30
–
Government as Shareholder (ALB) net
595,189
1,202,419
534,901
337,819
396,476
585,213
NDA and SLC expenditure (ALB) net
1,827,695
1,970,695
2,051,013
2,002,699
1,797,184
2,086,000
Nuclear Decommissioning Authority Income (CFER)
(51,639)
–
–
–
–
–
Total Capital DEL
10,123,201
10,749,071
10,457,778
10,954,736
11,227,917
13,522,848
Of which:
Staff costs
480,039
477,555
480,982
502,376
535,339
*
Purchase of goods and services
572,620
400,772
498,431
833,595
819,845
*
Income from sales of goods and services
(131,102)
(258,776)
(276,222)
(260,137)
(273,845)
–
Current grants to persons and non-profit bodies (net)
4,666,325
3,098,274
3,582,865
5,744,797
6,274,041
7,515,329
Current grants abroad (net)
302,460
317,400
330,130
340,794
346,659
342,350
Subsidies to public corporations
(2,655)
151,078
98,737
–
4,808
–
Capital support for local government (net)
54,528
42,270
41,473
5,826
1,588
85,000
Capital grants to persons & non-profit bodies (net)
999,113
424,678
482,446
888,564
725,074
754,790
Capital grants to private sector companies (net)
155,115
239,455
21,138
32,893
96,127
666,460
Capital grants abroad (net)
425,981
525,993
483,289
308,624
449,475
647,825
Capital support for public corporations
229,301
184,126
81,835
204,229
94,985
59,710
Purchase of assets
2,059,177
2,242,318
2,412,651
2,345,321
2,176,780
2,365,162
Income from sales of assets
(92,106)
(65,827)
(142,274)
(23,144)
(36,518)
–
Net lending to the private sector and abroad
571,866
1,062,304
319,670
163,080
88,455
132,170
Other capital
(167,461)
1,907,451
2,042,627
(132,082)
(74,896)
33,838

Capital AME
Maximise investment opportunities and bolster UK interests
2,310
–
–
–
–
–
Managing our energy legacy safely and responsibly
61,891
(38,273)
611,792
35,412
29,419
29,382
Science and Research
–
834
864
1,212
1,263
–
Government as Shareholder
210,202
129,181
(1,909)
(120,000)
37,000
800,000
Renewable Heat Incentive
(22)
–
–
–
–
–
Deliver an ambitious industrial strategy (ALB) net
17,299
84,842
(3,474)
(16,387)
365
10,000

250
Annual report and accounts 2019-20
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
Outturn
Outturn
Outturn
Outturn
Outturn
Plans
£’000
£’000
£’000
£’000
£’000
£’000
Science and Research (ALB) net
(55,972)
(61,156)
(63,845)
(59,692)
(59,496)
–
Government as Shareholder (ALB) net
(430,678)
(129,935)
(119,122)
(11,143)
(3,051)
(47,270)
Managing our energy legacy safely and responsibly (CFER)
–
–
–
(141,811)
(142,400)
(142,400)
Government as Shareholder
–
–
(1,621,078)
–
–
–
Government as Shareholder (ALB) net
(1,434,995)
–
–
–
–
–
Total Capital AME
(1,629,965)
(14,507)
(1,196,772)
(312,409)
(136,900)
649,712
Of which:
Staff costs
(16,992)
(18,461)
(18,719)
(15,325)
(14,078)
–
Purchase of goods and services
–
834
(7,325)
(2,330)
(4,890)
–
Capital grants to persons & non-profit bodies (net)
(22)
–
–
–
–
–
Capital grants to private sector companies (net)
(12,798)
(4,819)
(184,787)
–
–
–
Capital grants abroad (net)
2,310
–
–
–
–
–
Capital support for public corporations
223,000
134,000
129,250
(120,000)
37,000
800,000
Purchase of assets
350
54,158
318
–
–
–
Income from sales of assets
(32,150)
15
–
–
–
–
Net lending to the private sector and abroad
(1,922,761)
(141,781)
(1,732,112)
(169,341)
(145,086)
(179,670)
Other capital
129,098
(38,453)
616,603
(5,413)
(9,846)
29,382
Total Capital Budget
8,493,236
10,734,564
9,261,006
10,642,327
11,091,017
14,172,560

Total Departmental spending3
102,547,371
15,804,529
81,435,166
(92,444,763)
27,936,927
44,477,592
Of which:
Total DEL
12,348,054
12,355,667
11,905,316
11,889,328
13,734,822
29,126,971
Total AME
90,199,317
3,448,862
69,529,850
(104,334,091)
14,202,105
15,350,621
1
Includes impairments
2
Pension schemes report under FRS 17 accounting requirements. These figures therefore include cash payments made and contributions received, as well as certain non-cash items.
3
Total Departmental spending is the sum of the resource budget and the capital budget less depreciation. Similarly, total DEL is the sum of the resource budget DEL and capital budget
DEL less depreciation in DEL, and total AME is the sum of resource budget AME and capital budget AME less depreciation in AME.
* Figures for Plans for staff costs and purchase of goods and services, which include assumptions on future price and pay movements, are redacted in line with HMT guidance.

251
Annexes
Notes:
2019-20 Outturn figures differ slightly from those shown in the Statement of Parliamentary Supply as this table includes a
Prior Period Adjustment for Fleetbank Funding and BIS (Postal Services Act 2011) Company Limited due to an update in the
classification of transactions.
2019-20 Outturn figures differ slightly between lines from those shown in the Statement of Parliamentary Supply as
expenditure for Insolvency Service is shown here against Promote competitive markets and responsible business practices
to reflect current Estimate structures, but was recorded against Government as Shareholder in the 2019-20 Estimate.
The large increase in spend in 2020-21 on Deliver an ambitious industrial strategy Resource DEL is due to the COVID-19
Business Support Grants.
The large increase in spend in 2015-16 on Delivering affordable energy for households and businesses Resource DEL is due
to the Government Electricity Rebate.
Resource DEL expenditure for Nuclear Safeguards Development is shown separately in 2017-18 as this expenditure was
funded through a Contingencies Fund advance, pending passage of the Nuclear Safeguards Bill through Parliament.
Repayment of that advance in 2018-19 was made against Capability DEL, offset by the credit shown against Nuclear
Safeguards Development.
The receipt in 2018-19 against Managing our energy legacy safely and responsibly (CFER) Resource DEL relates to income
from coal pension scheme surpluses.
The increase in spend in 2016-17 and 2017-18 against Science and Research Capital DEL and decrease against Science
and Research (ALB) Capital DEL reflects the reclassification of expenditure for the Higher Education Funding Council for
England (HEFCE) for Science and Research following the Machinery of Government transfer of HEFCE to the Department for
Education. With effect from 2018-19 this expenditure falls under Research England as part of UKRI, under Science and
Research (ALB).
The figures for Depreciation in Resource AME include the movement in fair value for Contracts for Difference, shown against
Taking action on climate change and decarbonisation and Taking action on climate change and decarbonisation (ALB).
The large movements in take up of provisions within Resource AME in 2015-16, 2017-18 and 2018-19 is due to movements
in the long term discount rate for provisions. This largely impacts the lines for Nuclear Decommissioning Authority and
Managing our energy legacy safely and responsibly (ALB).
The receipt in 2017-18 against Government as Shareholder (CFER) Capital AME reflects the proceeds from the sale of the
Green Investment Bank.
In their role as administrator of the Government’s GB Renewable Heat Incentive scheme, Ofgem made/accrued payments to
scheme participants totalling £846,091,674.27 in the financial year 2019-20. Based on Ofgem’s sampling of the population
and subject to our detailed assumptions, we can be 95% confident that the estimated value of error for GB Renewable Heat
Incentive scheme payments made or accrued in the financial year 2019-20 is between the upper and lower limits of
£12,886,310 and £21,780,552. Based on the same assumptions, the most likely estimated value of error for the same
period is £17,333,431. This is less than 3 per cent of scheme spend in 2019-20.

252
Annual report and accounts 2019-20
Table 2 – Administration Budget
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
Outturn
Outturn
Outturn
Outturn
Outturn
Plans
£’000
£’000
£’000
£’000
£’000
£’000
Resource DEL
Deliver an ambitious industrial strategy
583
–
–
–
–
–
Promote competitive markets and
responsible business practices
4,703
5,126
4,690
4,680
5,093
1,540
Managing our energy legacy safely and
responsibly
–
(3,801)
–
–
–
–
Science and Research
59
–
2
–
(2)
398
Capability
327,944
288,546
280,222
350,166
384,234
476,969
Promote competitive markets and
responsible business practices (ALB) net
8,630
7,362
8,735
8,783
7,779
8,669
Taking action on climate change and
decarbonisation (ALB) net
3,752
3,535
3,447
3,353
5,354
5,135
Managing our energy legacy safely and
responsibly (ALB) net
10,191
12,104
7,044
6,912
4,833
7,941
Science and Research (ALB) net
4,685
986
3,371
5,547
7,410
4,300
Capability (ALB) net
39,218
39,818
33,635
30,475
34,693
1,500
Government as Shareholder (ALB) net
251
162
27
62
105
1,937
NDA and SLC expenditure (ALB) net
34,992
38,195
42,121
50,612
52,929
65,000
Total Administration Budget
435,008
392,033
383,294
460,590
502,428
573,389
Of which:
Staff costs
365,590
329,069
326,207
385,642
434,897
*
Purchase of goods and services
145,800
159,274
154,657
177,288
162,338
*
Income from sales of goods and services
(135,538)
(37,585)
(31,151)
(10,220)
(3,726)
(2,038)
Current grants to persons and non-profit
bodies (net)
29
38
493
425
325
154
Current grants abroad (net)
108
106
170
184
538
–
Subsidies to private sector companies
–
–
9
–
–
–
Subsidies to public corporations
–
–
–
28
–
–
Net public service pensions
–
–
(9)
(12)
(13)
–
Rentals
31,852
30,117
34,299
22,485
33,391
27,650
Depreciation1
29,956
27,034
22,901
18,850
26,902
27,764
Take up of provisions
2
–
(50)
–
3
–
Change in pension scheme liabilities
25
106
184
141
205
–
Other resource
(2,816)
(116,126)
(124,416)
(134,221)
(152,432)
(38,611)
1 Includes impairments.
* Figures for Plans for staff costs and purchase of goods and services, which include assumptions on future price and pay
movements, are redacted in line with HMT guidance.

253
Annexes
Annex B: Glossary
ACAS: Advisory, Conciliation and Arbitration
Service
AFS: available for sale
AHRC: Arts and Humanities Research Council
AI: artificial intelligence
ALB: arm’s-length bodies
AME: Annually Managed Expenditure
ARAC: Audit and Risk Assurance Committee
BAES: BAE Systems
BBB: British Business Bank Plc
BBIL: British Business Investments Ltd
BBLS: Bounce Bank Loan Scheme
BBSRC: Biotechnology and Biological Sciences
Research Council
BEIS: Department for Business, Energy and
Industrial Strategy
BFP: Business Finance Partnership
BNFL: British Nuclear Fuels Ltd
BVCA: British Venture Capital Association
CAT: Competition Appeal Tribunal
CBILS: Coronavirus Business Interruption Loan
Scheme
CCA: Climate Change Agreements
CCL: Climate Change Level
CERN: European Organisation for Nuclear
Research
CfD: Contracts for Difference
CFP: Committee on Fuel Poverty
CLBILS: Coronavirus Large Business
Interruption Loan Scheme
CNPA: Civil Nuclear Police Authority
CNPP: Civil Nuclear Pension Plan
COVID-19: Coronavirus pandemic
CRC: Carbon Reduction Commitment
CSOPS: Civil Servant and Other Pension Scheme
DDM: Dynamic Dispatch Model
Defra: Department for Food, Environment and
Rural Affairs
DEL: Departmental Expenditure Limit
DfE: Department for Education
ECF: Enterprise Capital Fund
EDFE: EDF Energy Nuclear Generation Limited
ECL: Expected Credit Loss
EFG: Enterprise Financial Guarantee
EHL: Enrichment Holdings Limited
EII: Energy Intensive Industries
EMR: Electricity Market Reform
EPSRC: Engineering and Physical Sciences
Research Council
ERDF: European Regional Development Fund
ESA: European Space Agency
ESC: Electricity Settlements Company
ESRC: Economic and Social Research Council
EUA: European Union Allowance
EUAA: European Union Aviation Allowance
EUETS: EU Emissions Trading Scheme
EUV: existing-use value
FDP: Funded Decommissioning Programme
FF: Future Fund scheme
FIDeR: Financial Investment Decision Enabling
for Renewables
FLS: Future Leaders Scheme
FRC: Financial Reporting Council
FReM: Government Financial Reporting Manual
FVTOCI: fair value through other comprehensive
income
FVTPL: fair value through profit or loss
GCRF: Global Challenges Research Fund
GDF: Geological Disposal Facility
GDPR: General Data Protection Regulation
GGC: Greening Government Commitments
GPA: Government Property Agency
GRAA: Government Resources and Accounts Act
HMT: HM Treasury
HPC: Hinkley Point C

254
Annual report and accounts 2019-20
IAEA: International Atomic Energy Agency
IDB: Inter-American Development Bank
IDP: Individual Development Programme
IAS: International Accounting Standards
IFRS: International Financial Reporting Standards
INSS: Insolvency Service
IPEV: International Private Equity and Venture
Capital
IRR: internal rate of return
ISCF: Industrial Strategy Challenge Fund
IUK: Innovate UK (Technology Strategy Board)
JET: Joint European Torus
JPA: Joint Procurement Agency
LCC: Local land charges
LCCC: Low Carbon Contracts Company Ltd
LEP: Local Enterprise Partnerships
MEIL: Midlands Engine Investment Ltd
MRC: Medical Research Council
MRCPS: Medical Research Council Pension
Scheme
NAO: National Audit Office
NDA: Nuclear Decommissioning Authority
NDPB: non-departmental public bodies
NERC: Natural Environment Research Council
NESTA: National Endowment for Science,
Technology and the Arts
NIF: National Insurance Fund
NLF: Nuclear Liabilities Fund
NaLF: National Loans Fund
NNHL: National Nuclear Holdings Ltd
NPIL: Northern Powerhouse Investment Ltd
NPLML: NPL Management Ltd
OCI: Other Comprehensive Income
ODA: Official Development Assistance
Ofgem: Office of Gas and Electricity Markets
OGA: Oil and Gas Authority
ONS: Office for National Statistics
OPRED: Offshore Petroleum Regulator for
Environment and Decommissioning
OSL: Ordnance Survey Limited
PBO: Parent Body Organisation
PCFP: Parliamentary Contributory Pension Fund
PCSPS: Principal Civil Service Pension Scheme
PDC: public dividend capital
PES: Public Expenditure System
PEVC: International Private Equity and Venture
Capital
PFRC: Performance Finance and Risk
Committee
PSH: Postal Services Holding Company Ltd
PIC: Projects and Investment Committee
PNC: Police National Computer
PO: partner organisations
POpCo: People and Operations Committee
POL: Post Office Ltd
PPE: property, plant and equipment
PV: present value
QA: Quality Assurance
R&D: Research and Development
RHLGF: Retail, Hospitality and Leisure Grant
Fund
RMPP: Royal Mail Pension Plan
RPS: Redundancy Payment Services
RSRL: Research Sites Restoration Limited
RWM: Committee on Radioactive Waste
Management
SBGF: Small Business Grant Fund
SCS: Senior Civil Servant
SDG: Sustainable Development Goals
SDP: single departmental plan
SFLG: Small Firms Loan Guarantee Scheme
SI: Statutory Instrument
SLC: Site Licence Company
SME: Small and Medium sized Enterprise
SoCNE: Statement of Comprehensive Net
Expenditure
SoFP: Statement of Financial Position
SoPS: Statement of Parliamentary Supply
SOSIA: Secretary of State Investor Agreement
STFC: Science and Technology Facilities Council
STSC: South Tees Site Company Ltd
SULCO: Start Up Loans Company
TCD: Target Commissioning Date
TCW: Target Commissioning Window
TLM: Transmission Loss Multiplier
TME: Total Managed Expenditure

255
Annexes
UKAEA: UK Atomic Energy Authority
UKGIP: UK Green Infrastructure Platform Ltd
UKIIF: UK Innovation Investment Fund
UKRI: UK Research and Innovation
UKSA: UK Space Agency
UKSBS: UK Shared Business Services Ltd
VAT: Value-Added Tax
WTC: Waste Transfer Contract

ISBN 978-1-5286-2121-2
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