Part II ARRANGEMENTS BETWEEN OPERATORS AND AUTHORITIES

5 Manner of making reimbursement arrangements
1 The payment periods and payment days are to be specified in the reimbursement arrangements and—
(a) payment periods must not be longer than 3 months or, in relation to a particular operator or particular operators, such shorter period as the authority may agree in writing with that operator or those operators ; and
(b) in relation to each payment period, the payment day must not be later than the day which is half way between the first and last days of the payment period or, in relation to a particular operator or particular operators, such day as the authority may agree in writing with that operator or those operators (and, in ascertaining the payment day, no account is to be taken of half days).
2 Each reimbursement payment must not be less than 85% of the amount estimated by the authority to be due to the operator in respect of the relevant payment period.
3 Subject to paragraph (9) of this regulation, the balance of each reimbursement payment must be paid, subject to any adjustments shown to be necessary in the light of information available to the authority pursuant to arrangements giving effect to these Regulations, not later than 3 months after the end of the relevant payment period.
4 Subject to paragraph (6) of this regulation, if any such balance as is mentioned in paragraph (3) of this regulation is not paid in accordance with that paragraph, provision must be made for the authority to pay simple interest (at a rate of base rate plus 1%) on the amount for the time being unpaid for the period beginning with the last date on which the balance should have been paid in accordance with paragraph (3) and ending with the date of actual payment.
5 For the purposes of paragraph (4) of this regulation:
(a) “base rate” (“cyfradd sylfaenol”) means the base rate quoted by the reference banks and effective throughout the period specified in that paragraph or, if more than one base rate is effective during that period, the average of those rates;
(b) if different base rates are quoted by different reference banks in relation to a particular day, the base rate for that day for the purpose of sub-paragraph (a) is the rate which, when the base rate quoted by each reference bank is ranked in a descending sequence of seven, is fourth in the sequence;
(c) for the purpose of this paragraph, “reference banks” (“banciau cyfeiriol”) means, in relation to a particular day, the seven largest institutions (by reference to the value of their assests) authorised under the Banking Act 1987 or any statutory re-enactment of that Act and incorporated in and carrying on a deposit-taking business in the United Kingdom and which quote a base rate.
6 Interest is not be payable until the entitlement to mandatory travel concessions under section 145(1) of the Act has been in force for 6 months nor in respect of any period falling wholly or partly within the first 6 months after that entitlement comes into force.
7 If the amount of any reimbursement payment made in accordance with paragraph (2) of this regulation in respect of any payment period exceeds the total amount of the payment found to be payable in respect of that period, provision must be made for the authority to notify the operator in writing accordingly and the authority may thereafter deduct the amount of the excess from the reimbursement payments due to that operator in respect of any subsequent payment period.
8 If the circumstances described in paragraph (7) of this regulation arise in relation to a person who is no longer an operator, the authority must notify that person accordingly and, unless that person disputes the existence or amount of the excess, that person must pay the amount of the excess to the authority within 30 days of the date of receipt of the notification.
9 Provision may be made for any reimbursement payment due in accordance with paragraphs (2) and (3) of this regulation to be made otherwise than in accordance with this regulation in any case where an operator fails to supply information in accordance with reimbursement arrangements giving effect to these Regulations—
(a) in the case of a payment due in accordance with paragraph (2), in sufficient time to allow the authority to form a reasonable estimate of the amount of the payment; or
(b) in the case of a payment due in accordance with paragraph (3), in sufficient time to allow the authority to calculate the amount of the payment.
10 Subject to paragraph (9) of this regulation, provision must be made for any reimbursement payment or any part of such a payment due to an operator in respect of mandatory concessions provided during any period of 12 months commencing on a date specified in the arrangements but not paid to be paid not later than 3 months after the expiry of that period.