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(1)As soon as may be after the first election of councillors for a new principal area, each existing rating authority whose area or part of whose area falls within that new principal area shall, in accordance with arrangements made by the Secretary of State by regulations, cause the appropriate contribution to be paid into the county fund where the new principal area is a county and into the general rate fund where the new principal area is a district.
(2)In subsection (1) above “the appropriate contribution”, in relation to an existing rating area or any part of such an area, means an amount equal to one quarter or such other fraction as the Secretary of State may by order prescribe of the product of a rate of 1p in the pound levied in that rating area, or, as the case may be, that part, for the year 1973-74, being—
(a)in the case of the area of an existing county borough, that product as ascertained for the purposes of Part II of Schedule 1 to the M1Local Government Act 1966;
(b)in a case where that product has been estimated by the rating authority for the purposes of section 12(2) of the M2General Rate Act 1967 (precepts by county councils, etc.), that product as so estimated;
(c)in any other case, that product estimated by the rating authority in the same way as it would fall to be estimated for the purposes of the said section 12(2).
(3)A statutory instrument containing an order under subsection (2) above—
(a)may apply to all existing rating areas or may make different provision in relation to existing rating areas of different descriptions; and
(b)shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(4)The council of a new area may borrow for the purpose of meeting any expenditure incurred by them before 1st April 1974 and the council of a new district in Wales may borrow for the purpose of lending to the council of a community in the district to enable the latter to meet any expenditure so incurred.
(5)With a view to providing sums which may be transferred by an order under section 254 below to one or more new local authorities any existing authority for an area outside Greater London may include in any rates made or precepts issued by them in respect of the last rate period before 1st April 1974 provision to meet contingencies or defray any expenditure which, if this Act had not been passed, would have fallen to be defrayed by the existing authority on or after that date and before the date on which the moneys to be received in respect of the next subsequent rate or precept would have become available.
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