4 Total Volume Adjustment
4.1 
where | ||
TVA | means Total Volume Adjustment | |
VA1 | means the price adjustment made in respect of the volume of [♦] [carried out in accordance with the relevant Service Specification] | |
VA2 | means the price adjustment made in respect of the volume of [♦] [carried out in accordance with the relevant Service Specification] | |
VA3 | means the price adjustment made in respect of the volume of [♦] [carried out in accordance with the relevant Service Specification] | |
VAn | means the price adjustment made in respect of the volume of [♦] [carried out in accordance with the relevant Service Specification] |
4.2 [VA1] Price Adjustment
Subject to paragraph 4.3 below the price adjustment (VA1) in respect of [♦] in any Payment Period shall be calculated in accordance with the following formula:11
where | ||
XPn | means the price of [♦] (in aggregate) in the relevant Contract Year and calculated in accordance with this paragraph 4.2 below | |
XUo | means the number of items of [♦] included in XPn as set out in Appendix [♦] | |
XUm | means the actual number of [♦] provided in the relevant Payment Period | |
NM | means the number of days in the relevant Payment Period | |
NY | means the number of days in the relevant Contract Year |
and where
where | ||
XPo | means the price of [♦] (in aggregate) at the Base Date | |
RPIo | means the Retail Prices Index for the Base Date | |
RPIn | means the Retail Prices Index for first month of the Contract Year in which the relevant Payment Period falls |
4.3 Flexibility around Volumes
No adjustment shall be made to VA1 where12
or
Note: VA2, VA3, VAx etc. drafting will follow the same principles as above.
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11 Worked example: The current price for processing the agreed base date number of 1000 payroll items in a year (XUo) is £110 (XPn), giving a unit price of 
In the relevant month the Authority buys 200 payroll items (XUm) as against the amount anticipated at the base date for that month calculated as the number for the year (XUo) multiplied by the number of days in the relevant month divided by the number of days in the year 
eg where XUo = 1000
1000 x 
= 82.19
Therefore the Authority is purchasing in the relevant month 117.81 (200 - 82.19) more payroll items than originally intended which multiplied by the unit price 11p gives a volume adjustment (VA1) of 117.81 x 11p = £12.96
12 Effectively this means that the Service Provider takes the risk of up to 5% volume variation upwards and downwards in a relevant Service. Where volume variations are greater than 5%, the Authority should take full risk of changes. They Authority may wish to consider relevant modifications to this equation where year on year volume changes are planned in advance.