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4.—(1) In respect of the services provided within a service year, a local authority must pay to Scottish Water the sum determined by the formula—
where—
“A” is the total amount paid to the local authority as council tax, water charges and sewerage charges for services provided within the service year by persons liable to pay that tax or those charges to that authority,
“B” is any amount falling within the definition of “A” which has been paid by a person and which—
has subsequently been repaid to that person, or
has subsequently been credited against a liability of that person to pay an amount which does not fall within that definition,
“C” is the total amount payable to the local authority as water charges and sewerage charges for the services within the service year in respect of dwellings situated within its area,
“D” is the total amount payable to the local authority as council tax for services provided within the service year in respect of dwellings situated within its area, and
“E” is—
for the service year beginning in 2023, the amount in the schedule which corresponds to the local authority in question,
for subsequent service years, the amount paid to each local authority in question in the preceding service year as increased by the greater of—
the consumer prices index for October before the start of the service year minus one percentage point, or
zero.
(2) For the purposes of the definitions of “C” and “D”, an amount is payable as council tax, water charges or sewerage charges if—
(a)it has been demanded by the local authority from a person appearing to that authority to be liable to pay it, and
(b)it—
(i)has been paid,
(ii)remains payable, or
(iii)has been written off by the local authority as irrecoverable.
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