Summary: Ms X complains about the amount the Council paid her business as a grant. Ms X also complains the Council is wrongly pursuing her for business rates. The Ombudsman will not investigate Ms X’s complaint. This is because there is not enough evidence of fault in how the Council originally decided to award her business a grant. The Council has also now paid the full amount and so an investigation could not achieve anything more. Ms X’s liability for busines rates has been decided in court and so the matter is outside our jurisdiction.

The complaint

1. The complainant, whom I shall call Ms X, complains the Council wrongly failed to award the full grant of £25,000 which was available to certain businesses affected by Covid-19. Ms X also says the Council is wrongly pursuing her for business rates.

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The Ombudsman’s role and powers

2. This complaint involves events that occurred during the Covid-19 pandemic. The Government introduced a range of new and frequently updated rules and guidance during this time. We can consider whether the council followed the relevant legislation, guidance and our published “Good Administrative Practice during the response to COVID-19”.
3. 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’. We provide a free service, but must use public money carefully. We may decide not to start or continue with an investigation if we believe:

• it is unlikely we could add to any previous investigation by the Council, or
• it is unlikely further investigation will lead to a different outcome. (Local Government Act 1974, section 24A(6), as amended)

4. 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)
5. We may decide not to start or continue with an investigation if we think the issues could reasonably be, or have been, raised within a court of law. (Local Government Act 1974, sections 24A(6) and 34B(8), as amended)
6. We cannot investigate a complaint about the start of court action or what happened in court. (Local Government Act 1974, Schedule 5/5A, paragraph 1/3, as amended)

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How I considered this complaint

7. I considered Ms X’s complaint to the Ombudsman and the information she provided. I also gave Ms X the opportunity to comment on a draft statement before reaching a final decision on her complaint.

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What I found

Background

8. In March 2020, the government created schemes for councils to pay grants to small businesses. This was because the COVID-19 restrictions affected so many of them. Businesses in the retail, hospitality and leisure sector, with a rateable value up to £15,000 on 11 March 2020, were eligible for a grant of £10,000. Businesses with a rateable value between £15,000 and £51,000 were eligible for a grant of £25,000 – subject to certain eligibility criteria.
9. The Department for Business, Energy and Industrial Strategy produced guidance to help councils administer the grants. This said that:

“Any changes to the rating list (rateable value or to the hereditament) after the 11 March 2020 including changes which have been backdated to this date should be ignored for the purposes of eligibility…In cases where it was factually clear to the Local Authority on the 11 March 2020 that the rating list was inaccurate on that date, Local Authorities may withhold the grant and/or award the grant based on their view of who would have been entitled to the grant had the list been accurate… This is entirely at the discretion of the Local Authority…” (Department for Business, Energy and Industrial Strategy, Small Business Grant Fund and Retail, Hospitality and Leisure Grant Fund: Guidance for Local Authorities, paragraphs 42, 44 and 45)

What happened

10. Ms X owns two neighbouring business properties (Property A and Property B). The Council says that in October 2019, Ms X said the properties had been split into six separate units and she was waiting for the Valuation Office to approve the change. This would affect the rateable value of the properties.
11. In April 2020, Ms X applied for a grant available to businesses affected by the COVID-19 pandemic. The Council rejected Ms X’s application because she had not provided any proof of occupation (a requirement of the grant scheme) or about the split into separate units.
12. Ms X provided proof of occupation and the Council agreed to pay a grant of £10,000. It said that if the Valuation Office did not split the properties (which would lower their rateable value) then it would pay an extra £15,000.
13. Ms X complained to the Council about its decision. Ms X argued the Council should pay her the full £25,000 because the guidance for councils said “Any changes to the rating list (rateable value or to the hereditament) after the 11 March 2020 including changes which have been backdated to this date should be ignored for the purposes of eligibility.”
14. Ms X was also unhappy about how the Council had dealt with her business rates for Properties A and B. Ms X said that she had paid £7,141.04 on 09 January 2020, which was £95.02 more than her bill for 2019/20. But Ms X said the Council had sent a summons on 06 January 2020 and had obtained a liability order on 27 January 2020. Ms X wanted the Liability Order removed and compensation for the emotional and mental damage she said it had caused.
15. In its responses to Ms X’s complaints the Council said:
• In October 2019, Ms X told the Council Properties A and B would be split into six individual units.
• Guidance on administering the grant said that where the rating list was inaccurate on 11 March, councils could withhold the grant and such decisions were entirely at the Council’s discretion.
• It had decided to finalise the grant when the Valuation Office made its decision. It would pay a further £15,000 if the Valuation Office did not split the properties.
• Ms X had separate business rates accounts for Properties A and B. The Council said it had sent a reminder in November 2019, and when no payments were received, a summons (incurring a charge of £60) was issued on 06 January 2020. On 09 January 2020 Ms X had made three payments. One of these was for Property A’s account, the other two were for Property B. These payments left balances of £3,536 and £531.19 respectively. The Liability Order added a further charge of £35 to Property A’s account leaving a balance of £3,571. In May 2020, the Council had amended Ms X’s liability order – taking into account the Government’s business rates retail discount scheme. This left a balance of £1,101.16 for Property A and £531.19 for Property B.
16. In response to my enquiries, the Council said that in August 2020, the Valuation Office had confirmed it would not be splitting Properties A and B. The Council had therefore paid Ms X a further £15,000. It also said that Ms X had made no further payments for business rates.

Assessment

17. The Council was responsible for deciding if a business qualified for one of the grants available due to COVID-19. As explained in paragraph 8, the amount payable was linked to the rateable value of a business. Ms X had previously told the Council Properties A and B had been separated. This would have affected their rateable value and the amount of grant Ms X was entitled to. The Council decided to wait until the Valuation Office’s decision was known before paying Ms X the full grant.
18. As I explain in paragraph 4, I could only criticise that decision if the Council did not reach it properly. The Council explained its decision to Ms X and it was in line with the relevant guidance. There is not enough evidence of fault by the Council in how it reached this decision for the Ombudsman to become involved. Also, the Council paid Ms X the full amount as soon as it received the Valuation Office’s decision. An investigation by the Ombudsman could not achieve anything more for Ms X.
19. Ms X disputes the amount of business rates the Council says she owes. But this is not something the Ombudsman can consider. This is because the Court has decided Ms X is liable for business rates for Properties A and B. If Ms X wanted to challenge the amount the Council said she owed, then Ms X had the opportunity to present any arguments or evidence she wanted the Court to consider.
20. The Court was the appropriate body to consider what was a legal matter. It was for the Court to decide whether Ms X was liable for the business rates demanded. The Court has decided Ms X is liable for business rates and so the exception at paragraph 6 applies. We have no jurisdiction to consider Ms X’s liability for business rates.

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Final decision

21. The Ombudsman will not investigate Ms X’s complaint. This is because there is not enough evidence of fault in how the Council decided to award her business a grant and an investigation could not achieve anything more. Ms X’s complaint about business rates is outside the Ombudsman’s jurisdiction.

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Investigator's decision on behalf of the Ombudsman