2.—(1) The activity falling within section 2(2)(b) of the Local Government Act 1988 shall not be treated as a defined activity so long as—
(a)it is carried out by a police authority, and
(b)the amount estimated by the police authority as the gross cost of carrying out the activity through their direct labour organisation or a similar organisation in the immediately preceding financial year does not exceed £125,000.
(2) For the purposes of this article, the cost of carrying out this activity shall be estimated as regards England in accordance with article 3(3) of the Local Government Act 1988 (Defined Activities) (Exemptions) (England) Order 1988(1), and as regards Wales in accordance with article 3(3) of the Local Government Act 1988 (Defined Activities) (Exemptions) Wales Order 1988(2).
(3) In this article “police authority” means—
(a)a police authority constituted under section 3 of the Police Act 1964(3), and
(b)the Common Council of the City of London in its capacity as a police authority.
1964 c. 48. Section 3 is substituted by section 2 of the Police and Magistrates' Courts Act 1994 (c. 29).