43 Calculation of “relevant deficit” for the purposes of section 42
Water Industry Act 1991 (1991 c 56) | Legislation

43  Calculation of “relevant deficit” for the purposes of section 42

(1) For the purposes of section 42 above the relevant deficit for any year on a water main is the amount (if any) by which the [relevant revenue in respect of that main for that year is] exceeded by the annual borrowing costs of a loan of the amount required for the provision of that main.

(2) The annual borrowing costs of a loan of the amount required for the provision of a water main is the aggregate amount which would fall to be paid in any year by way of payments of interest and repayments of capital if an amount equal to so much of the costs reasonably incurred in providing that main as were not incurred in the provision of additional capacity had been borrowed, by the water undertaker providing the main, on terms—

(a) requiring interest to be paid and capital to be repaid in twelve equal annual instalments; and

(b) providing for the amount of the interest to be calculated at such rate, and in accordance with such other provision, as may have been determined for

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