Summary: We shall not investigate this complaint about the Council refusing Mr X a business grant. An investigation would be unlikely to find fault.

The complaint

1. Mr X complains the Council refused a COVID-19-related business grant for his holiday home business. He reports the lack of the £10,000 grant compounded the business’ problems from not being able to have holiday lettings due to the COVID-19 situation.

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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 Mr X provided and the relevant government guidance. I shared my draft decision with Mr X and considered the comments and supporting documents he sent in response to the 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 such a grant depends on its being on the business rating list on 11 March 2020 and on meeting certain other criteria. 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.
7. 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.
8. The property Mr X lets out as a holiday home was on the council tax list, not the business rating list, on 11 March 2020. There is no suggestion Mr X had asked for it to be on the rating list by then. Nor is there any evidence the Council had reason to believe, by 11 March 2020, that the rating list was inaccurate in not including that property. Mr X first asked for the property to be on the rating list instead of the council tax list in April 2020. The Council referred the matter to the VOA, which moved the house from the council tax list to the business rating list and backdated the change by some years.
9. As explained above, the Council could only offer a small business grant or retail, hospitality and leisure grant if:
1. on 11 March 2020, the business was on the rating list and met the other criteria, or
2. on 11 March 2020, the Council was ‘factually clear’ the rating list was inaccurate for this address. The relevant point here is not whether the rating list was inaccurate on 11 March 2020 but whether, on 11 March 2020, the Council knew the rating list was inaccurate.
10. On point a), on 11 March 2020 the business was not on the rating list. So the Council could not award a grant on that basis.
11. On point b), there is no evidence the Council knew the ratings list was inaccurate on 11 March 2020. The Council’s decision to refuse Mr X’s application was therefore in line with the Government’s guidance.
12. Mr X has suggested the Council has wider discretion where on 11 March 2020 it was not aware of an inaccuracy on the rating list. That is not the case.
13. I appreciate Mr X’s situation is difficult and he is unhappy with the Council’s position. However, the Council acted in line with the government’s guidance, as it must do.

Response to my draft decision

14. Mr X argues the VOA’s backdating of his property’s entry in the rating list means ‘effectively’ the business has been on the rating list since many years before the COVID-19-related business grants scheme was introduced. For the purposes of grant eligibility, that is not the case. It is a matter of fact that the business was not on the rating list on 11 March 2020 and was added after that date, with the change backdated. So the situation was one to which the government’s guidance to councils applies as I have described above.
15. Responding to a draft of this decision, Mr X argued the Council should not have based its decision just on the government’s written guidance to councils, but should also have considered:
• The government’s guidance to businesses about the same grant schemes, part of which suggests the Council has wider discretion regarding inaccuracies in the rating list than the guidance to councils says.
• The underlying aims of the grants schemes, as set out in government statements, including announcements and comments in the House of Commons.
16. I have considered those points and the extracts from government guidance, announcements and comments in the House of Commons that Mr X sent me. However, the government gave councils guidance precisely to tell councils how to manage the grant schemes. Between March and August 2020, the government issued six versions of that guidance to incorporate various changes. So it is reasonable to suppose that, had the government wanted councils to do something different from what its guidance said regarding backdated changes to the rating list, the government would have changed its guidance to councils to say so. That did not happen. The fact that the guidance to businesses differs from the guidance to councils does not mean it was fault for the Council to follow the guidance to councils.
17. Nor do I consider the Council was at fault for not also basing its decisions on speeches and statements rather than the government’s guidance for councils. Mr X is arguing the Council should have based its decisions on a menu of factors. Doing so would have risked introducing confusion and inconsistency. I do not consider it was fault for the Council to take the government’s written guidance for councils as setting out the government’s expectations for how councils should administer grants.
18. Overall, therefore, I do not consider the Council basing its decision on the government’s guidance for councils amounted to fault. So I am not persuaded there was fault in how the Council reached its decision in Mr X’s case.
19. Mr X is also dissatisfied with how the Council handled his communications about the matter. It is not a good use of public resources to investigate complaints about how councils handle communications and correspondence, if we are not dealing with the substantive issue. Here, we are not investigating the substantive issue (the refusal of the grant), so we shall not investigate how the Council handled Mr X’s communications and complaint about the matter.

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Final decision

20. The Ombudsman will not investigate this complaint. This is because there is insufficient evidence of fault by the Council.

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Investigator's decision on behalf of the Ombudsman