The Local Authorities (Capital Finance and Approved Investments) (Amendment No. 2) Regulations 1995

Modification of the credit ceiling

10.  In Part II of Schedule 3—

(a) for paragraph 3 substitute the following—

“3.   A local authority’s credit ceiling at any time on or after 24th August 1995 shall be determined in accordance with Part III of Schedule 3 to the Act subject to the following modifications—

(a) no account shall be taken of any amount set aside by the authority by virtue of regulation 26(1)(e), and

(b) where, at any time, amounts for the time being set aside by the authority (whether voluntarily or pursuant to a requirement under Part IV of the Act) as provision to meet credit liabilities are applied by the authority under section 136(8) of the Leasehold Reform, Housing and Urban Development Act 1993(1), the authority’s credit ceiling shall, at that time, be increased by an amount equal to the amount so applied.”;

(b) in paragraph 4—

(i) after “For the purposes of this paragraph” insert “and paragraph 5 below”, and for “modification” in sub-paragraph (2) substitute “modifications”; and

(ii) in the modification to Schedule 3 to the Act, for “10C. In paragraphs 10A and 10B above” substitute “10D. In paragraphs 10A, 10B and 10C above”; and

(c) after paragraph 4 insert the following paragraph—

“5.— (1) For the purposes of this paragraph, “new police authority” means a police authority established under section 3 of the Police Act 1964 (as substituted by section 2 of the Police and Magistrates' Courts Act 1994) for a police area.

(2) In relation to—

(a) a new police authority whose credit ceiling on 1st April 1995 was determined in accordance with paragraph 10B(1) of Schedule 3 to the Act; and

(b) a local authority which is a relevant county council,

in addition to the modifications made in paragraphs 3 and 4 above, Schedule 3 to the Act is modified by the insertion after paragraph 10B of the following paragraph—

“10C.— (1) In this paragraph—

• “the council”, in relation to a new police authority, means the county council of which a committee was the old police authority in accordance with section 2 or 3(4) of the 1964 Act;

• “the Order” means the Police and Magistrates' Courts Act 1994 (Commencement No. 5 and Transitional Provisions) Order 1994(2); and

• “retained arrangement” means a credit arrangement in relation to property, rights and liabilities which have not vested in a new police authority under article 9 of the Order, or have been apportioned under that article.

(2) Where the credit ceiling of a new police authority on 1st April 1995 has been determined in accordance with paragraph 10B(1) above—

(a) the credit ceiling of the new police authority on 24th August 1995 shall be reduced by the amount, if any, which that authority are deemed to have borrowed from the council by virtue of article 11 of the Order; and

(b) the credit ceiling on 24th August 1995 of the council shall be increased by that amount.

(3) Where the credit ceiling of a new police authority on 1st April 1995 has been determined in accordance with paragraph 10B(1) above, and includes an amount attributable to the use by the council of a credit approval as authority to enter into or agree to a variation of a retained arrangement—

(a) the credit ceiling of the new police authority on 24th August 1995 shall be reduced by an amount determined for each such arrangement in accordance with sub-paragraph (4) below; and

(b) the credit ceiling on 24th August 1995 of the council shall be increased by an equivalent amount for each such arrangement.

(4) For the purposes of sub-paragraph (3)(a) above, the amount to be determined for a retained arrangement is either—

(a) the amount equal to the extent to which a credit approval has been used as authority to enter into or agree to a variation of the arrangement less the total amount set aside from the revenue account of the council as provision for credit liabilities in relation to the arrangement (otherwise than in accordance with a determination under section 50(3)(c) of the Act); or

(b) where a proportion has been agreed under article 9 of the Order for the purposes of apportioning the property, rights and liabilities relating to the arrangement, that proportion of the amount referred to in paragraph (a) above.””

(1)

1993 c. 28.

(2)

S.I. 1994/3262 (C.83); amended by S.I. 1995/246 (C.8) and S.I. 1995/899 (C.23).