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

Commutation adjustment

29.—(1) Subject to paragraph (2), where a commuted payment was made to or for the benefit of a local authority in the financial year beginning on 1st April 1992, the local authority may reduce the amount of its minimum revenue provision for the current financial year, calculated in accordance with regulation 28, by an amount calculated in accordance with the following formula—

where—

• G is the total amount of contributions, grants and subsidies which would have been payable to the local authority by the Secretary of State for the current financial year but for commutation;

• I is the total of—

  (a)

  the amount by which interest, payable by the local authority in the current financial year on loans, is reduced; and

  (b)

  the amount by which interest, payable to the local authority in the current financial year on deposits and investments, is increased,

  by virtue of commutation; and

• M is the amount of minimum revenue provision for the current financial year which would have been calculated by the local authority in accordance with regulation 28 but for commutation, less the amount of minimum revenue provision for the current financial year actually calculated in accordance with regulation 28.

(2) Where the amount calculated in accordance with the formula in paragraph (1) is a negative amount, that amount shall be treated as nil.

(3) For the purposes of paragraph (1)—

“commutation” means the making of a commuted payment to, or for the benefit of, a local authority in the financial year beginning on 1st April 1992;

“commuted payment” has the same meaning as that term had on 31st March 2004 in section 157 of the Local Government and Housing Act 1989 (commutation of, and interest on, periodic payments of grants etc.)(1); and

“current financial year” has the same meaning as in regulation 28(4).

(1)

Section 157 was amended by paragraph 43 of Schedule 4 to the Police and Magistrates' Courts Act 1994 (c. 29) and by section 103 of, and paragraph 1(2)(zd) of Schedule 7 to, the Police Act 1997 (c. 16); there are other amendments to section 157 that are not relevant to these Regulations.