The Local Authorities (Capital Finance and Accounting) (England) Regulations 2003

Interest on late payments

13.—(1) Where all or part of the specified amount is not paid by the local authority to the Secretary of State on the due date, the local authority shall use capital receipts, which it has derived from the disposal of an interest in housing land, to pay to him interest on the unpaid amount.

(2) The interest shall be calculated at one per cent. above base rate on a day to day basis from the due date to the date of payment and compounded with three-monthly rests.

(3) In this regulation—

“base rate” means the base rate for the time being quoted by the reference banks or, where there is for the time being more than one such base rate, the rate which, when the base rate quoted by each bank is ranked in descending sequence of seven, is fourth in the sequence; and

“reference banks” means the seven largest persons for the time being who—

(a)

have permission under Part IV of the Financial Services and Markets Act 2000 (permission to carry on regulated activities)(1) to accept deposits;

(b)

are incorporated in the United Kingdom and carrying on there a regulated activity of accepting deposits; and

(c)

quote a base rate in sterling,

and for the purpose of this definition the size of a person at any time is to be determined by reference to the gross assets denominated in sterling of that person, together with any subsidiary (as defined in section 736 of the Companies Act 1985 (“subsidiary”, “holding company” and “wholly owned subsidiary”)(2)), as shown in the audited end-of-year accounts last published before that time.

(1)

2000 c. 8, to which there are amendments not relevant to these Regulations.

(2)

1985 c. 6; section 736 was substituted for section 736 as originally enacted by section 144(1) of the Companies Act 1989 (c. 40).