Where the Lord Chancellor receives damages paid in favour of a legally aided party, the Lord Chancellor must—
deposit those damages in one general account at a deposit-taker; and
except where paragraph (3) applies, pay the legally aided party a sum representing the gross rate of interest earned on the damages while they are held by the Lord Chancellor.
The interest payable to the legally aided party under paragraph (1)(b) is to be calculated—
at a rate of 0.5% per annum less than the rate payable on damages deposited in the general account; and
for the period beginning with the third business day after the date on which the damages are received by the Lord Chancellor, and ending with the date on which the Lord Chancellor determines the amount to be paid to the legally aided party by virtue of regulation 17(7).
The Lord Chancellor is not required to pay interest where the damages received—
are £500 or less; or
are held by the Lord Chancellor for less than 28 days.
In this regulation—
“business day” means a day other than a Saturday, a Sunday, Christmas Day, Good Friday or a bank holiday in England and Wales under the Banking and Financial Dealings Act 1971 ;
“deposit taker” means the Bank of England, or a branch of ...—
a person with permission to accept deposits under Part 4A of the Financial Services and Markets Act 2000 (permission to carry on regulated activities); ...
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . and
“general account” means an interest bearing account opened in the name of the Lord Chancellor, the title of which does not identify any legally aided party.
The definition of “deposit taker” under paragraph (4)(b) must be read with—
section 22 of the Financial Services and Markets Act 2000 (regulated activities);
any relevant order under that section; and
Schedule 2 to that Act (regulated activities).