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Local Government Finance Act 1992

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32 Calculation of budget requirement.E

(1)In relation to each financial year a billing authority shall make the calculations required by this section.

(2)The authority must calculate the aggregate of—

(a)the expenditure which the authority estimates it will incur in the year in performing its functions and will charge to a revenue account for the year;

(b)such allowance as the authority estimates will be appropriate for contingencies in relation to expenditure to be charged to a revenue account for the year;

(c)the financial reserves which the authority estimates it will be appropriate to raise in the year for meeting its estimated future expenditure;

(d)such financial reserves as are sufficient to meet so much of the amount estimated by the authority to be a revenue account deficit for any earlier financial year as has not already been provided for; and

[F1(e)any amounts which it estimates will be transferred from its general fund to its collection fund pursuant to a direction under subsection (5) of section 98 of the 1988 Act and charged to a revenue account for the year, other than (in the case of an authority in England) any amounts which it estimates will be so transferred pursuant to a direction under that subsection relating to the difference between amounts in respect of community charges credited and charged to a revenue account for any earlier financial year.]

(3)The authority must calculate the aggregate of—

(a)the sums which it estimates will be payable for the year into its general fund [F2or, as the case may be) council fund] and in respect of which amounts will be credited to a revenue account for the year, other than sums which it estimates will be so payable in respect of redistributed non-domestic rates, revenue support grant [F3, additional grant [F4or relevant special grant or (in the case of the Common Council only) police grant;]];

[F5(b)any amounts which it estimates will be transferred from its collection fund to its general fund pursuant to a direction under subsection (4) of section 98 of the 1988 Act and credited to a revenue account for the year, other than (in the case of an authority in England) any amounts which it estimates will be so transferred—

(i)pursuant to a direction under that subsection relating to the difference between amounts in respect of community charges credited and charged to a revenue account for any earlier financial year; and

(ii)in the case of the Common Council, pursuant to a direction under that subsection in respect of an amount calculated by reference to the provisional amount of its non-domestic rating contribution under Part II of Schedule 8 to that Act; and]

(c)the amount of the financial reserves which the authority estimates that it will use in order to provide for the items mentioned in paragraphs (a), (b) and (e) of subsection (2) above.

[F6(3A)In the case of any billing authority in Wales, subsection (3)(a) above does not require the estimation of sums payable into their council fund in respect of council tax or [F7non-domestic rates or the grant paid to them under section 88A of the Local Government Finance Act 1988].]

(4)If the aggregate calculated under subsection (2) above exceeds that calculated under subsection (3) above, the authority must calculate the amount equal to the difference; and the amount so calculated shall be its budget requirement for the year.

(5)In making the calculation under subsection (2) above the authority must ignore—

(a)payments which must be met from its collection fund under section 90(2) of the 1988 Act or from a trust fund; and

(b)subject to subsection (2)(e) above, sums which have been or are to be transferred from its general fund to its collection fund.

(6)In estimating under subsection (2)(a) above the authority shall take into account—

(a)the amount of any precept issued to it for the year by a local precepting authority; and

(b)the amount of any levy or special levy issued to it for the year;

but (except as provided by regulations under section 41 below or regulations under section 74 or 75 of the 1988 Act) shall not anticipate a precept, levy or special levy not issued.

F8(6A). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7)For the purposes of subsection (2)(c) above an authority’s estimated future expenditure is—

(a)that which the authority estimates it will incur in the financial year following the year in question, will charge to a revenue account for the year and will have to defray in the year before the following sums are sufficiently available, namely—

(i)sums which will be payable for the year into its general fund [F9or(as the case may be) council fund] and in respect of which amounts will be credited to a revenue account for the year; and

(ii)sums which will be transferred as regards the year from its collection fund to its general fund; and

(b)that which the authority estimates it will incur in the financial year referred to in paragraph (a) above or any subsequent financial year in performing its functions and which will be charged to a revenue account for that or any other year.

(8)In making the calculation under subsection (3) above the authority must ignore, subject to paragraph (b) of that subsection, sums which have been or are to be transferred from its collection fund to its general fund.

[F10(8A)Subsections (2)(e), (3)(b), (7)(a)(ii) and (8) above do not apply in relation to a Welsh county council or county borough council.

(8B)Subsection (5) above shall have effect in relation to a Welsh county council or county borough council as if for paragraphs (a) and (b) there were substituted—

"(a)payments which must be met from a trust fund;

(b)payments to be made to the Secretary of State under paragraph 5 of Schedule 8 to the 1988 Act or regulations made under paragraph 5(15) of that Schedule;

(c)payments to be made in respect of the amount of any precept issued by a major precepting authority under Part I of this Act (but not payments to be so made in respect of interest on such an amount); and

(d)payments to be made to another person in repaying, under regulations under the 1988 Act or Part I of this Act, excess receipts by way of non-domestic rates or council tax."]

(9)The Secretary of State may by regulations do one or both of the following—

(a)alter the constituents of any calculation to be made under subsection (2) or (3) above (whether by adding, deleting or amending items);

(b)alter the rules governing the making of any calculation under subsection (2) or (3) above (whether by deleting or amending subsections (5) to [F11(8B)] above, or any of them, or by adding other provisions, or by a combination of those methods).

(10)Calculations to be made in relation to a particular financial year under this section must be made before 11th March in the preceding financial year, but they are not invalid merely because they are made on or after that date.

(11)F12. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F13(12)In this section and section 33 below—

  • “police grant" means so much of the grant payable in accordance with paragraph 3.1 of the relevant police grant report as excludes the amounts shown in columns (b) and (c) of the Table set out below that paragraph;

  • “relevant special grant" means any of the following grants, that is to say—

    (i)

    the special grant payable in accordance with paragraphs 4 and 6 of the special grant report for England (Special Grant Report (No. 31)) approved by a resolution of the House of Commons pursuant to section 88B of the 1988 Act M1 on 5th February 1998; and

    (ii)

    the special grant payable in accordance with paragraphs 5 and 7 of that special grant report;

    and in this subsection “the relevant police grant report" means the police grant report (The Police Grant Report (England and Wales) 1998/99) approved by a resolution of the House of Commons pursuant to section 46 of the Police Act 1996 M2 on 4th February 1998.]

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Extent Information

E1This version of this provision extends to England only; a separate version has been created for Wales.

Amendments (Textual)

F1S. 32(2)(e) substituted (8.2.1994) by S.I. 1994/246, reg. 3(1)

F2Words in s. 32(3)(a) inserted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, s. 38(11), Sch. 12 para. 4(2) (with ss. 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2)); S.I. 1995/852, art. 6(1)

F3Words in s. 32(3)(a) substituted (8.2.1994) by S.I. 1994/246, reg.3(2)(a)

F4Words in s. 32(3)(a) substituted (3.2.1995) by S.I. 1995/234, reg. 2(1)

F5S. 32(3)(b) substituted (8.2.1994) by S.I. 1994/246, reg. 3(2)(b)

F6S. 32(3A) inserted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, s. 38(11), Sch. 12 para. 4(3) (with ss. 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2)); S.I. 1995/852, art. 6(1)

F7Words in s. 32(3A) substituted (7.2.1996) by S.I. 1996/56, art. 2(2)

F9Words in s. 32(7)(a)(i) inserted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, 38(11), Sch. 12, para, 4(4) (with ss. 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2)): S.I. 1995/852, art. 6(1)

F10S. 32(8A)(8B) inserted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, s. 38(11), Sch. 12 para. 4(5) (with ss. 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2)); S.I. 1995/852, art. 6(1)

F11Word in s. 32(9)(b) substituted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, s. 38(11), Sch. 12 para. 4(6) (with 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2); S.I. 1995/852, art. 6(1)

F13S. 32(12) substituted (7.2.1998) by S.I. 1998/213, reg. 2

Modifications etc. (not altering text)

C5S. 32 modified (E.) (6.2.2007 with application as mentioned in reg. 1(2)(3) of the amending S.I.) by The Local Authorities (Alteration of Requisite Calculations) (England) Regulations 2007 (S.I. 2007/227), reg. 3

C6Pt. I Ch. III (ss. 30-38) modified (E.) (1.2.1993) by S.I. 1993/22, art. 3(4)

C7Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)

C8S. 32 applied (with modifications) (E.) (15.2.1995) by S.I. 1995/161, art. 3(2)(a)

C9Power to modify conferred (25.6.1997) by 1997 c. 50, s. 62(4); S.I. 1997/1377, art. 2(2)(e)

C11S. 32(2)(e) modified (2.2.2001 with effect as mentioned in reg. 1(3)) by S.I. 2001/216, reg. 2(a)

C13S. 32(12) modified (2.2.2001 with effect as mentioned in reg. 1(3)) by S.I. 2001/216, reg. 2(b)

Marginal Citations

M11988 c.41; section 88B was substituted by paragraph 18 of Schedule 10 to the 1992 Act.

32 Calculation of budget requirement.W

(1)In relation to each financial year a billing authority shall make the calculations required by this section.

(2)The authority must calculate the aggregate of—

(a)the expenditure which the authority estimates it will incur in the year in performing its functions and will charge to a revenue account for the year;

(b)such allowance as the authority estimates will be appropriate for contingencies in relation to expenditure to be charged to a revenue account for the year;

(c)the financial reserves which the authority estimates it will be appropriate to raise in the year for meeting its estimated future expenditure;

(d)such financial reserves as are sufficient to meet so much of the amount estimated by the authority to be a revenue account deficit for any earlier financial year as has not already been provided for; and

[F14(e)any amounts which it estimates will be transferred from its general fund to its collection fund pursuant to a direction under subsection (5) of section 98 of the 1988 Act and charged to a revenue account for the year, other than (in the case of an authority in England) any amounts which it estimates will be so transferred pursuant to a direction under that subsection relating to the difference between amounts in respect of community charges credited and charged to a revenue account for any earlier financial year.]

(3)The authority must calculate the aggregate of—

(a)the sums which it estimates will be payable for the year into its general fund [F15or, as the case may be) council fund] and in respect of which amounts will be credited to a revenue account for the year, other than sums which it estimates will be so payable in respect of redistributed non-domestic rates, revenue support grant [F16, additional grant [F17or relevant special grant or (in the case of the Common Council only) police grant;]];

[F18(b)any amounts which it estimates will be transferred from its collection fund to its general fund pursuant to a direction under subsection (4) of section 98 of the 1988 Act and credited to a revenue account for the year, other than (in the case of an authority in England) any amounts which it estimates will be so transferred—

(i)pursuant to a direction under that subsection relating to the difference between amounts in respect of community charges credited and charged to a revenue account for any earlier financial year; and

(ii)in the case of the Common Council, pursuant to a direction under that subsection in respect of an amount calculated by reference to the provisional amount of its non-domestic rating contribution under Part II of Schedule 8 to that Act; and]

(c)the amount of the financial reserves which the authority estimates that it will use in order to provide for the items mentioned in paragraphs (a), (b) and (e) of subsection (2) above.

[F19(3A)In the case of any billing authority in Wales, subsection (3)(a) above does not require the estimation of sums payable into their council fund in respect of council tax or [F20non-domestic rates or the grant paid to them under section 88A of the Local Government Finance Act 1988].]

(4)If the aggregate calculated under subsection (2) above exceeds that calculated under subsection (3) above, the authority must calculate the amount equal to the difference; and the amount so calculated shall be its budget requirement for the year.

(5)In making the calculation under subsection (2) above the authority must ignore—

(a)payments which must be met from its collection fund under section 90(2) of the 1988 Act or from a trust fund; and

(b)subject to subsection (2)(e) above, sums which have been or are to be transferred from its general fund to its collection fund.

(6)In estimating under subsection (2)(a) above the authority shall take into account—

(a)the amount of any precept issued to it for the year by a local precepting authority; and

(b)the amount of any levy or special levy issued to it for the year;

but (except as provided by regulations under section 41 below or regulations under section 74 or 75 of the 1988 Act) shall not anticipate a precept, levy or special levy not issued.

F21(6A). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7)For the purposes of subsection (2)(c) above an authority’s estimated future expenditure is—

(a)that which the authority estimates it will incur in the financial year following the year in question, will charge to a revenue account for the year and will have to defray in the year before the following sums are sufficiently available, namely—

(i)sums which will be payable for the year into its general fund [F22or(as the case may be) council fund] and in respect of which amounts will be credited to a revenue account for the year; and

(ii)sums which will be transferred as regards the year from its collection fund to its general fund; and

(b)that which the authority estimates it will incur in the financial year referred to in paragraph (a) above or any subsequent financial year in performing its functions and which will be charged to a revenue account for that or any other year.

(8)In making the calculation under subsection (3) above the authority must ignore, subject to paragraph (b) of that subsection, sums which have been or are to be transferred from its collection fund to its general fund.

[F23(8A)Subsections (2)(e), (3)(b), (7)(a)(ii) and (8) above do not apply in relation to a Welsh county council or county borough council.

(8B)Subsection (5) above shall have effect in relation to a Welsh county council or county borough council as if for paragraphs (a) and (b) there were substituted—

"(a)payments which must be met from a trust fund;

(b)payments to be made to the Secretary of State under paragraph 5 of Schedule 8 to the 1988 Act or regulations made under paragraph 5(15) of that Schedule;

(c)payments to be made in respect of the amount of any precept issued by a major precepting authority under Part I of this Act (but not payments to be so made in respect of interest on such an amount); and

(d)payments to be made to another person in repaying, under regulations under the 1988 Act or Part I of this Act, excess receipts by way of non-domestic rates or council tax."]

(9)The Secretary of State may by regulations do one or both of the following—

(a)alter the constituents of any calculation to be made under subsection (2) or (3) above (whether by adding, deleting or amending items);

(b)alter the rules governing the making of any calculation under subsection (2) or (3) above (whether by deleting or amending subsections (5) to [F24(8B)] above, or any of them, or by adding other provisions, or by a combination of those methods).

(10)Calculations to be made in relation to a particular financial year under this section must be made before 11th March in the preceding financial year, but they are not invalid merely because they are made on or after that date.

(11)F25. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F26(12)In this section and in section 33 below, “relevant special grant” means the special grant payable in accordance with the special grant report (Special Grant Report (No 20) (Wales) 2001) approved by the National Assembly for Wales pursuant to section 88B of the 1988 Act on 24th January 2002.]

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Annotations are used to give authority for changes and other effects on the legislation you are viewing and to convey editorial information. They appear at the foot of the relevant provision or under the associated heading. Annotations are categorised by annotation type, such as F-notes for textual amendments and I-notes for commencement information (a full list can be found in the Editorial Practice Guide). Each annotation is identified by a sequential reference number. For F-notes, M-notes and X-notes, the number also appears in bold superscript at the relevant location in the text. All annotations contain links to the affecting legislation.

Extent Information

E2This version of this provision extends to Wales only; a separate version has been created for England

Amendments (Textual)

F14S. 32(2)(e) substituted (8.2.1994) by S.I. 1994/246, reg. 3(1)

F15Words in s. 32(3)(a) inserted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, s. 38(11), Sch. 12 para. 4(2) (with ss. 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2)); S.I. 1995/852, art. 6(1)

F16Words in s. 32(3)(a) substituted (8.2.1994) by S.I. 1994/246, reg.3(2)(a)

F17Words in s. 32(3)(a) substituted (3.2.1995) by S.I. 1995/234, reg. 2(1)

F18S. 32(3)(b) substituted (8.2.1994) by S.I. 1994/246, reg. 3(2)(b)

F19S. 32(3A) inserted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, s. 38(11), Sch. 12 para. 4(3) (with ss. 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2)); S.I. 1995/852, art. 6(1)

F20Words in s. 32(3A) substituted (7.2.1996) by S.I. 1996/56, art. 2(2)

F22Words in s. 32(7)(a)(i) inserted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, 38(11), Sch. 12, para, 4(4) (with ss. 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2)): S.I. 1995/852, art. 6(1)

F23S. 32(8A)(8B) inserted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, s. 38(11), Sch. 12 para. 4(5) (with ss. 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2)); S.I. 1995/852, art. 6(1)

F24Word in s. 32(9)(b) substituted (3.4.1995 subject to art. 6(2)-(5) of the commencing S.I.) by 1994 c. 19, s. 38(11), Sch. 12 para. 4(6) (with 54(5)(7), 55(5), Sch. 17 paras. 22(1), 23(2); S.I. 1995/852, art. 6(1)

F26S. 32(12) substituted (W.) (28.2.2002 with effect in relation to the financial year beginning on 1.4.2002) by The Local Authorities (Alteration of Requisite Calculations) (Wales) Regulations 2002 (S.I. 2002/328), reg. 2

Modifications etc. (not altering text)

C15S. 32 modified (W.) (28.2.2007 with application as mentioned in reg. 1(3) of the amending S.I.) by The Local Authorities (Alteration of Requisite Calculations) (Wales) Regulations 2007 (S.I. 2007/571), reg. 2

C16Pt. I Ch. III (ss. 30-38) modified (E.) (1.2.1993) by S.I. 1993/22, art. 3(4)

C17Pt. I Chs. III-IV (ss. 30-52) modified (E.) (1.2.1993) by S.I. 1993/22, art. 4(2)

C18S. 32 applied (with modifications) (E.) (15.2.1995) by S.I. 1995/161, art. 3(2)(a)

C19Power to modify conferred (25.6.1997) by 1997 c. 50, s. 62(4); S.I. 1997/1377, art. 2(2)(e)

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