In the case where an annual sum which has been or might be awarded under these regulations does not exceed £35, the Secretary of State may, at this discretion, compound his liability in respect thereof by paying a lump sum equivalent to the capital value of the annual sum, and, if any lump sum payable has been or might be awarded in addition to such annual sum under regulation 18, 19 or 20, the Secretary of State may likewise discharge his liability in respect thereof by an immediate payment.

In any other case, if the person who has been awarded long-term or retirement compensation requests him to do so, the Secretary of State may, after having regard to the state of health of that person and the other circumstances of the case, compound up to one quarter of his liability to make payments under the award (other than payments to a widow, child or other dependant under Regulation 23) by the payment or an equivalent amount as a lump sum or, where any compensation has been awarded as a lump sum, by increasing that compensation to such equivalent amount, and in calculating for this purpose the liability of the Secretary of State to make such payments, account shall be taken of the annual value of lump sum payments of compensation other than payments of compensation under Part III of these regulations.

The making of a composition under paragraph (2) in relation to an award of long-term or retirement compensation shall not prevent the subsequent making of compensation under paragraph (1) in relation to that award but, subject as aforesaid, not more than one composition may be made in relation to any award.