Summary: The Ombudsman will not investigate this complaint about the Council refusing to award a business grant. This is because the evidence suggests the Council was not at fault.

The complaint

1. Mrs X complains the Council refused her application for a Covid-19-related small business grant. She states not getting the £10,000 grant worsened her business’ financial difficulties and worsened the strain she was under when the business could not operate during the government’s COVID-19 lockdown.

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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 would find fault. (Local Government Act 1974, section 24A(6), as amended)

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How I considered this complaint

4. I considered the information Mrs X provided, copy correspondence the Council provided and information on the Valuation Office Agency’s website. I gave Mrs X the opportunity to comment on my draft decision.

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What I found

5. In March 2020, the government created schemes for councils to pay grants to small businesses and retail, hospitality and leisure businesses. This was because the Covid-19 restrictions affected so many of those businesses.
6. A business’ right to a grant depends on its being on the business rating list on 11 March 2020, its rateable value and its eligibility for certain business rates reliefs on that date.
7. Government guidance states later changes to the rating list, even if such changes are backdated to 11 March 2020, do not entitle a business to a grant. A council can make an exception if, on 11 March 2020, it was already ‘factually clear’ to the Council that the rating list was inaccurate for a particular address or business. This is only intended to prevent ‘manifest errors,’ such as the rating list wrongly identifying the property or rateable value.
8. The Valuation Office Agency (VOA), not the Council, compiles the rating list and decides if a business is liable for business rates and, if so, its rateable value.
9. Mrs X moved her business to its current property in December 2019. The property’s previous occupant was a different type of business to Mrs X’s. Mrs X did not contact the Council’s business rates department or the VOA to change the rating list information for the address before 11 March 2020. The Council refused Mrs X’s application for a small business grant.
10. As Mrs X’s business was not on the rating list at 11 March 2020, there was no fault in the Council refusing the grant application on that ground.
11. In summer 2020, the VOA changed the rating list entry for the address and backdated the change to December 2019. However, as paragraph 6 above explained, a backdated change after 11 March 2020 does not entitle a business to a grant unless on 11 March 2020 it was already clear to the Council that the rating list was inaccurate.
12. So the key point here is not whether the rating list for Mrs X’s property was inaccurate on 11 March 2020 but whether, on 11 March 2020, the Council knew the rating list was inaccurate.
13. Mrs X states she had told the Council’s planning department in October 2019 about her planned move. So she argues Council knew about the change before 11 March 2020.
14. I have seen the relevant correspondence from October 2019. Mrs X’s husband emailed the planning department stating, ‘I would like to enquire what the correct process is for applying to change the business use of a commercial premises.’ The email gave more details of the possible change, and added, ‘Ideally we would like to aim to open the new business by the beginning of December 2019…’
15. That contact was only about whether planning permission might be needed to change the property’s use from the old business to Mrs X’s business type. It referred to something Mrs X was hoping to do rather than a change that had happened.
16. The Council’s planning and business rates sections have quite separate legal functions. We would not expect the planning department, when dealing with an enquiry about a purely planning-related matter, to share that information with the business rates section, especially when no change had happened yet. So Mrs X’s dealing with another Council department about a separate Council responsibility before March 2020 is not relevant here.
17. On 11 March 2020, Mrs X’s business was not on the rating list. Neither did the Council (in its role as business rates authority) have any reason on that date to believe the list was wrong for that address. Therefore the Council’s refusal of the small business grant was in line with the government’s guidance. I do not find fault with that decision.
18. Mrs X says another business in a similar situation received a grant. The Council has not given Mrs X any details about that other business, for confidentiality reasons. While I note what Mrs X says, my role is primarily to consider if there was fault in the Council refusing Mrs X’s grant application. It is not my role to oversee the Council’s grant-making decisions generally. As I have explained above, the evidence suggests the Council was not at fault as the decision in Mrs X’s case was in line with the government’s guidance. So the question of what might have happened to a different business does not directly affect my view here.

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Final decision

19. The Ombudsman will not investigate this complaint. This is because investigation is unlikely to find fault by the Council that resulted in Mrs X not getting the grant.

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Investigator's decision on behalf of the Ombudsman