UK emergency funding fails to reach businesses affected by Covid

Small businesses are missing out on millions of pounds in emergency grants promised by the UK government as early as November, triggering warnings that many will not survive unless access to that money is unlocked.

The councils have struggled to distribute the money, including a share of £ 12bn in support first offered last year according to the Local Government Association, due to the volume of paperwork and changes to lockout regulations.

There have been 10 different funding rounds to support small businesses without the cash reserves or big business liabilities thanks to local level restrictions established in October and the one-month lockdown for England from the 5th November. The programs also cover support for various regional restrictions. in December and the current lockdown in England, which is expected to last until at least February 22.

Anthony Pender, co-founder of Yummy Pubs, a chain of four businesses in the south-east of England, said local councils had paid just £ 19,000 of the £ 111,000 pledged in grants since the fall.

Only one of the four sites had received money available to pubs forced to close under Tier 3 and 4 restrictions in October and December, and none of the January bid money up to 9,000. £ per site has not been paid.

“If we don’t get the grant money by the end of February, we’ll have serious problems,” he said.

Phil Hales, owner of the family-owned True Hair and Beauty salon in Gravesend, Kent, said he heard from his local council last week that the grants are due in early February – more than six weeks after the lockdown rules blocked trading – meaning he was forced to use the state-backed Bounce Back loan program to pay his bills and wages until then.

“For me [the pandemic] is the war I hoped I wouldn’t see in my lifetime, I’m ready to fight it, but I didn’t expect to have to buy my own guns and ammunition, ”Hale said.

The British Beer and Pub Association estimates that around three-quarters of so-called wet pubs, which focus on selling drinks, had not received the £ 1,000 grant promised by the government in December, while half of pubs were still waiting for the support offered. during the November lockdown.

Garry Tallent, owner of the Red Lion pub in Chobham, Surrey, said he received a grant created to cover December costs last Friday, but was concerned that the £ 687 he was receiving fortnightly for the January lockdown was ‘Help little with £ 8,000 in overhead while the pub is closed.

Although local authorities have received the £ 5bn funding due for the current lockdown, many are still waiting for cash to cover trade losses between December 19 and January 5, the period between a revision of the tier system to include the top tier of tier 4 and the current lockout. The Local Government Association said councils are prioritizing payment of larger amounts owed for January closures.

Local authorities attribute the delays to a combination of bureaucracy created to ensure compliance with state aid rules and are reviewing fraud claims and the slow release of central government funds.

Craig Beaumont, chief of external affairs at the Federation of Small Businesses, criticized the “postcode lottery” for grants. “Some boards have done well, but others take weeks or months,” he said. “Boards are afraid of making mistakes and want clarity from government; while the government insists they get the money out.

Officials said all of the £ 4.6bn in grants announced at the start of the latest lockdown had been paid to 314 local authorities as of January 15 – but not all money from previous grant programs had yet been released .

The Ministry of Business, Energy and Industrial Strategy said: “We are working tirelessly with the local authorities, who are responsible for administering the grants, to ensure that funds are disbursed as quickly as possible to those. in need. “

Additional reports by Andy Bounds