8.1.2 Scheme administration component
What is a participating institution's administration funding component?
The Scheme administration component is the amount equal to the participating institution or funder of last resort's share of the administration of the Scheme for a quarter. The Scheme must calculate the participating institution's share using the method prescribed in section 67 of the NRS Rules.
The Scheme administration component is calculated by adding together 2 amounts:
- The first amount is a percentage of 7.5% of the institution's gross liability amount for each redress payment they are liable for during the quarter. If more than one redress payment was made during the quarter, work out the percentage for each payment and add them together.
- The second amount is the institution's share of a $1,000 contribution, as a proportion of their gross liability amount against the total of gross liability amounts of all liable participating institutions for a redress payment. If more than one redress payment was made during the quarter, work out the proportion for each payment and add them together.
- Finally, add the first and second amount to find the institution's share of the Scheme administrative component for a redress payment.
Step | Action |
---|---|
1 |
Calculate per-quarter administrative charge To work out the administrative charge for each institution, apply the following formula to redress payments made in that quarter:
Round up to the nearest whole cent. The gross liability is calculated in step 3 or step 8 of the method statement (5.1.1). |
2 |
Calculate institution's share of $1,000-per-claim legal contribution To work out the institution's share of the $1,000-per-claim 'legal contribution', apply the following formula to redress payments made in that quarter:
The gross liability is calculated in step 3 or step 8 of the method statement (5.1.1). Note: If the institution is the only liable participating institution for a redress payment, they will pay $1,000. |
3 |
Calculate the Scheme administrative component for a redress payment Per-quarter administrative charge + Institution's share of $1,000-per-claim legal contribution = Scheme administrative component for a redress payment |