Summary: Mr and Mrs X complain about the Council’s refusal to provide a business rates’ discount and business grant, placing their business at risk of closure. The Ombudsman finds no fault in the Council’s decision making process.

The complaint

1. Mr and Mrs X complain about the Council’s refusal to grant their business an Expanded Retail Discount (the “Discount”) or a Retail, Hospitality and Leisure Grant (the “Grant”). As a result their business is at risk of closing.

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The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. The law says we cannot normally investigate a complaint unless we are satisfied the council knows about the complaint and has had an opportunity to investigate and reply. However, we may decide to investigate if we consider it would be unreasonable to notify the council of the complaint and give it an opportunity to investigate and reply (Local Government Act 1974, section 26(5))
4. The law says we cannot normally investigate a complaint when someone could take the matter to court. However, we may decide to investigate if we consider it would be unreasonable to expect the person to go to court. (Local Government Act 1974, section 26(6)(c), as amended)
5. We cannot question whether a council’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
6. If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

7. I spoke to Mr and Mrs X and reviewed documents provided by them and the Council. I gave all parties the opportunity to comment on a draft of this decision and I considered any comments provided.

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What I found

Expanded Retail Discount (the “Discount”)

8. In 2019/20 the Government increased the availability of the business rates retail discount in response to the COVID-19 pandemic. It published guidance for councils on how to apply the Discount; “Business Rates, Expanded Retail Discount 2020/21: Coronavirus Response Local Authority Guidance” (the “Guidance”).
9. Each council will adopt its own scheme and decide whether to grant the Discount, having regard to the Guidance.
10. The Guidance lists the types of businesses included, however says this is a guide only and it is for councils to decide if a business is broadly similar in nature to those listed and so eligible. Of relevance to this case, the list includes businesses that provide tool hire to visiting members of the public.
11. The Guidance also lists the types of businesses not included, but repeats this is a guide only and it is for a council to decide if a business is broadly similar in nature to those listed. Of relevance to this case, this includes businesses that are not reasonably accessible to visiting members of the public.

Retail, Hospitality and Leisure Grant (the “Grant”)

12. The Government published guidance for councils on how to apply the Grant; “Grant Funding Schemes” (March 2020). Of relevance to this case, businesses eligible for the Discount were eligible for the Grant.

Council policy

13. The Council publishes a Retail Discount Policy 2019/20 and 2020/21 on its website. The Council refers to the full list of eligible businesses referenced in the Guidance and says businesses that are not reasonably accessible to visiting member of the public will not be eligible. The Head of Revenues and Benefits will be responsible for approving all applications, with a monthly review by the Director of Corporate Services. There will be no right of appeal.

What happened

14. Mr and Mrs X run an event hire company that hires out specialist tools for weddings and corporate events. Their business is open to the public by appointment for event planning.
15. Mr and Mrs X complained the Council said they were not entitled to the Discount or Grant because it classed their business as a warehouse. However, they operated in the hospitality sector and so asked the Council to look into this in more detail.
16. The Council passed their complaint to the Head of Revenues and Benefits to respond.
17. The Council explained their business did not qualify for support under the hospitality or retail criteria. It follows the Guidance, which lists businesses that are and are not eligible. The Guidance says businesses are not eligible if they are not reasonably accessible to visiting members or the public. Their business is not eligible and it has no discretion with this.
18. Mr and Mrs X pointed the Council to a statement made by the Chancellor, who said support would be available to a significant number of event hire companies that have premises. They considered their own business should therefore qualify. Further, other councils supported similar businesses and the lack of written guidance should not prevent the Council following the Chancellor’s statement. And, the Guidance did not provide an exhaustive list of eligible businesses.
19. The Council said its policy is based on the Guidance which it believes it must follow. Their business is not accessible to visiting members of the public. That is, customers cannot walk into the premises during normal opening hours and order or purchase goods or services. It cannot comment on why other councils have granted relief.
20. Mr and Mrs X then provided evidence their business was open for the public to plan meetings and for them to demonstrate equipment. The Council considered this but said its view remained the same.
21. Mr and Mrs X then asserted they ran a tool hire business, which fell under the list of eligible businesses. They also noted the Council had awarded a grant to a similar tool hire business, Company Y.
22. The Council said it decided having regard to the Guidance and the approach taken by other councils. Although the Chancellor made a statement the formal guidance had not changed. It could not comment on other councils or discuss specific cases. But it has reviewed a number of decisions and on occasion found it had erred and so taken steps to recover grants incorrectly awarded.
23. Mr and Mrs X asked how to appeal. The Council said there was no right of appeal.
24. Mr and Mrs X then contacted the CEO.
25. The Director of Corporate Services responded. They told Mr and Mrs X the Council considered they ran an events production company which was not in the list of eligible businesses and it was for the Council to decide if a business was broadly similar. It felt their business did not fit the criteria of a retail, hospitality or leisure business. It disagreed it was similar to a tool hire business, accessible to members of the public to enter the premises without appointment and hire equipment to take away with them or have delivered. It cannot comment on the actions of other councils but it has since reviewed its own decisions and it will recover grants from those paid in error. There is no right to appeal, they can only seek judicial review.
26. Mr and Mrs X then contacted the Ombudsman.
27. The Council questioned the Ombudsman’s decision to investigate given Mr and Mrs X had not made a formal complaint, there was no evidence of service failure and the only way to appeal was by judicial review.
28. In response to enquiries the Council provided evidence of its decision making on Company Y. The Council also confirmed that following its review it found one instance where it had awarded a grant in error and it had since taken action to recover this.

Findings

29. Mr and Mrs X made a complaint which the Council referred to its Head of Service. The Council decided not to follow its complaints process and it did not refer Mr and Mrs X back to its complaints process at any time. The Head of Service considered and addressed all matters raised. A Director then reviewed his decision and upheld it. I consider the Council knew about the complaint and had reasonable opportunity to investigate and reply. I therefore consider it appropriate to investigate.
30. Mr and Mrs X have the right to go to court and ask for a judicial review of the Council’s decision. However, this is expensive, they are unlikely to get legal aid and, they would have to rely on information they gathered; it would be very difficult for them to see the Council’s files, which are relevant here. I therefore consider it appropriate to exercise my discretion to investigate.
31. The Guidance lists businesses that are eligible and those ineligible, but makes clear this is a guide only and it is for each council to decide if a business is similar. The Council applied its local policy, which mirrors the Guidance. It decided Mr and Mrs X’s business was not similar to a tool hire business or other eligible business listed in the Guidance, because members of the public could not attend without appointment and hire goods. And it decided the business met the Guidance on ineligible businesses, because it was not reasonably accessible to visiting members of the public. Although the Council was wrong to say it had no discretion, I am satisfied it fully considered the arguments made by Mr and Mrs X, particularly upon its review. It was for the Council to decide how much weight, if any, to give to the Chancellor’s statement. I consider the Council decided in line with law and policy. I find no fault in its decision making process.
32. Councils should make consistent decisions. The Council has provided me with evidence of its decision on whether to give a grant to Company Y. I cannot say whether it awarded a grant or not, for confidentiality reasons. However, having reviewed the evidence provided I am satisfied the outcome was consistent and in line with law and policy.

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Final decision

33. I find no fault in the Council’s decision making process on whether Mr and Mrs X’s business is eligible for a Discount or Grant. I have completed my investigation.

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Investigator's decision on behalf of the Ombudsman