SCHEDULE 2PAYMENTS OF CAPITAL AND INTEREST IN RESPECT OF THE REMAINING ONE HALF OF THE SUM OF THE CAPITAL VALUES SPECIFIED IN ARTICLES 3 AND 5

4.—(1) Subject to the following provisions of this paragraph, if from 13 April in any year (“the specified year”) the Secretary of State does not come under a duty by virtue of paragraph 2 to make payments in respect of the amount specified in column 2 of Table B in relation to the specified year (“the specified amount”) and there is on 14 April of the specified year no subsisting duty on the Secretary of State to make payments in respect of that amount under paragraph 3, then thereafter the provisions of this Schedule shall apply as if the specified amount had been deleted from column 2 of Table B in relation to the specified year and added to the amount (“the later amount”) (if any) specified in column 2 of Table B in relation to the year (“the later year”) 10 years later than the specified year and as if the total, or the specified amount, as the case may be (“the substituted amount”), had been inserted in column 2 of Table B in relation to the later year, and, unless the contrary intention appears, any reference in this Schedule (including this paragraph) (however expressed) to a Table B amount, or an amount specified in column 2 of Table B in relation to any particular year, shall be construed accordingly.

(2) If—

(a)on any relevant date (for the purposes of paragraph 2) the circumstances specified in paragraph 2(2) arise in relation to a composite amount, or

(b)a composite amount is included in those amounts in respect of which the Secretary of State comes under a duty to make payments under paragraph 3,

then paragraph 2 or 3, as the case may be, shall impose on the Secretary of State a duty to make payments in respect of such of the Table B amounts as are comprised in that composite amount as he may notify to the persons administering the section, before the 14 April in the relevant year for the purposes of that paragraph, as being such of those amounts as would, if they had not been comprised in a relevant amount, have resulted in the circumstances specified in paragraph 2(2) or 3(2), not arising.

(3) Where the application of sub-paragraph (2) has resulted in the duty to make payments arising in respect of one or more, but not all, Table B amounts comprised in a composite amount, any reference in sub-paragraph (1) (however expressed) to a Table B amount shall include any Table B amount which is comprised in a composite amount.

(4) Where, by virtue of sub-paragraph (2), a duty to make payments has arisen in relation to a Table B amount which is comprised in a composite amount, then thereafter—

(a)in sub-paragraph (b) of each of the definitions of “relevant amount” in paragraphs 2 (including that provision as it applies for the purposes of paragraphs 7 and 11) and 3 the reference to any amount specified in column 2 of Table B in relation to which there is no subsisting duty to make payments shall be taken to include a reference to a composite amount in relation to any part of which there is no subsisting duty to make payments under paragraph 2 or 3; and

(b)each of the definitions of “relevant amount” in paragraphs 2 (including that provision as it applies for the purposes of paragraphs 7 and 11) and 3 shall exclude any Table B amount comprised in the composite amount and in relation to which there is a subsisting duty to make payment.

(5) In this paragraph “composite amount” means a substituted amount which comprises more than one Table B amount.