Paragraph 3 Adjusted overall spending target
The initial overall spending target for the current scheme year must be adjusted in accordance with this paragraph.
The Secretary of State must—
review the aggregate core spending estimate for the preceding scheme year; and
if it appears to the Secretary of State that the aggregate amount of prescribed rebates provided under the core spending Part in the preceding scheme year will be greater or less than the aggregate core spending estimate for that scheme year, adjust the estimate accordingly.
If the aggregate core spending estimate for the preceding scheme year is reduced under sub-paragraph (2)(b), the Secretary of State must increase the initial overall spending target for the current scheme year by the same amount.
If the aggregate core spending estimate for the preceding scheme year is increased under sub-paragraph (2)(b), the Secretary of State must reduce the initial overall spending target for the current scheme year by the same amount.
The Secretary of State must calculate the difference between—
the aggregate amount of prescribed rebates provided under the core spending Part in Year-2; and
the aggregate core spending estimate for Year-2 (including any subsequent adjustments to the estimate under Schedule 1 to the 2022 Regulations or this Schedule).
If the aggregate amount of prescribed rebates mentioned in sub-paragraph (5)(a) is greater than the aggregate core spending estimate mentioned in sub-paragraph (5)(b), the Secretary of State must reduce the initial overall spending target for the current scheme year by the difference.
If the aggregate amount of prescribed rebates mentioned in sub-paragraph (5)(a) is less than the aggregate core spending estimate mentioned in sub-paragraph (5)(b), the Secretary of State must increase the initial overall spending target for the current scheme year by the difference.
Adjustments under sub-paragraphs (6) or (7) are in addition to adjustments under sub-paragraphs (3) or (4).
The adjusted overall spending target for the current scheme year is the initial overall spending target for that scheme year after adjustments (if any) under this paragraph.