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New government business grants not enough

Released on May 19, 2020

The latest government business grants scheme will not provide anywhere near enough cash to support the vast majority of businesses in southern Oxfordshire affected by the COVID-19 pandemic, that’s the message from the area’s two district councils. 

South Oxfordshire and the Vale of White Horse district councils are currently assessing how many businesses may be eligible but have explained that they’d only be able to provide a tiny percentage of eligible businesses a grant to support them during this crisis. Nationally, the government is only providing an extra five per cent of funding on top of the money received in the first round of COVID-19 business grants in April. 

The government has provided initial criteria within which the district councils can create a discretionary scheme. 

Cllr Leigh Rawlins, Cabinet Member for Finance, and Deputy Leader of South Oxfordshire District council, said: “We now have the challenge of trying to spread this money to as many businesses as possible while ensuring they also receive a meaningful amount to make any kind of a difference. The simple matter is there is not enough money to do that. We will see if we can try to identify the businesses most in need, but that won’t be easy.” 

Cllr Andrew Crawford, Cabinet Member for Finance at the Vale of White Horse District Council, said: “We know our small and micro businesses are worried and we’re doing everything we can to help them, but it’s very clear that this new grants scheme will fall quite short of being able to help those that weren’t eligible for the last round. We will do everything we can to provide guidance and advice to businesses that aren’t successful in their application and to point them to other sources of funding, like the government COVID-19 loans scheme.” 

The councils are aiming to start paying funds by early June in line with the government’s guidance. They are now setting up the online application process using the detailed eligibility criteria the government has just announced, so it might take until near the end of May before businesses in South and Vale can start applying. However, taking a bit of time now to set it up now will ensure the process is quicker and easier to complete, meaning the councils can pay the funds to successful applicants without delay. 

Only businesses that were trading on 11 March 2020 will be eligible for this scheme and funds received will be subject to tax, although only for businesses that make an overall profit once the grant income is included. 

This grant funding will be for businesses that are not eligible for other support schemes. Businesses which have received cash grants from any central government COVID-19 related scheme are ineligible for funding from the Discretionary Grants Fund. 

Note for editors

The government has asked local authorities to prioritise the following types of businesses for grants from this funding pot, but the government wants local authorities to exercise their local knowledge and discretion to determine what businesses to support within these criteria:

  • Small businesses in shared offices or other flexible workspaces. Examples could include units in industrial parks, science parks and incubators which do not have their own business rates assessment;
  • Regular market traders with fixed building costs, such as rent, who do not have their own business rates assessment;
  • Bed and Breakfasts which pay council tax instead of business rates; and
  • Charity properties in receipt of charitable business rate relief which would otherwise have been eligible for Small Business Rates Relief or Rural Rate Relief.