(1)The Secretary of State must pay in respect of each financial year to each Strategic Health Authority sums not exceeding the amount allotted for that year by the Secretary of State to the Strategic Health Authority towards meeting the expenditure of the Strategic Health Authority which is attributable to the performance by it of its functions in that year.
(2)Where the Secretary of State has made an initial determination of the amount (“the initial amount”) to be allotted for any year to a Strategic Health Authority under subsection (1), he may increase the initial amount by a further sum if it appears to him that over a period notified to the Strategic Health Authority—
(a)it satisfied any objectives notified to it as objectives to be met in performing its functions, or
(b)it performed well against any criteria notified to it as criteria relevant to the satisfactory performance of its functions (whether or not the method of measuring its performance against those criteria was also notified to it).
(3)“Notified” means specified or referred to in a notice given to the Strategic Health Authority by the Secretary of State.
(4)In making any increase under subsection (2), the Secretary of State may (whether by directions under subsection (9) or otherwise) impose any conditions he considers appropriate on the application or retention by the Strategic Health Authority of the sum in question.
(5)Subsection (6) applies where—
(a)the Secretary of State has, under subsection (2), increased by any sum the amount to be allotted for any year to a Strategic Health Authority,
(b)the Secretary of State has notified the Strategic Health Authority of the allotment, and
(c)it subsequently appears to the Secretary of State that the Strategic Health Authority has failed (wholly or in part) to satisfy any conditions imposed in making that increase.
(6)Where this subsection applies, the Secretary of State may reduce—
(a)the allotment made to that Strategic Health Authority for that year, or
(b)when he has made an initial determination of the amount (“the initial amount”) to be allotted for any subsequent year to the Strategic Health Authority under subsection (1), the initial amount,
by an amount not exceeding the sum mentioned in subsection (5)(a).
(7)An amount is allotted to a Strategic Health Authority for a year under this section when it is notified by the Secretary of State that the amount is allotted to it for that year.
(8)The Secretary of State may, subject to subsection (6), make an allotment under this section increasing or reducing an allotment previously so made; and the reference to a determination in subsection (2) includes a determination made with a view to increasing or reducing an allotment previously so made.
(9)The Secretary of State may give directions to a Strategic Health Authority with respect to—
(a)the application of sums paid to it under this section, or
(b)the payment of sums by it to the Secretary of State in respect of charges or other sums referable to the valuation or disposal of assets.
(10)Sums falling to be paid to Strategic Health Authorities under this section are payable subject to such conditions as to records, certificates or otherwise as the Secretary of State may determine.