Summary: The Council was not at fault for refusing a COVID-19 business grant on the basis the premises were not mainly used for retail.

The complaint

1. Mrs X complained the Council wrongly refused a COVID-19 business grant for one of the three units her business operates from.

Back to top

The Ombudsman’s role and powers

2. We investigate complaints of injustice caused by ‘maladministration’ and ‘service failure’. I have used the word ‘fault’ to refer to these. 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)
3. 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”.
4. 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)

Back to top

How I considered this complaint

5. I considered:
• the information provided by Mrs X and the Council; and
• relevant law and guidance, as set out below.
6. Mrs X and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

Back to top

What I found

Relevant law and guidance

COVID-19 business grants

7. The Government has introduced a series of grant schemes from March 2020 onwards to support businesses affected by restrictions imposed in response to the COVID-19 pandemic.

Local Restrictions Support Grant

8. The Government introduced the Local Restrictions Support Grant to help businesses required to close from November 2020 due to COVID-19. Eligible businesses were those mandated to close by the government and included non-essential retail, leisure, personal care, sports facilities, and hospitality businesses.

What happened

9. Mrs X runs a business from three separate units in a commercial premises. She applied for grants for all three units. The Council paid grants for two units but refused a grant for the remaining unit, which I will call unit 3.
10. Mrs X applied for a grant for unit 3 on 16 February 2021. On the application form she confirmed the business was forced to close between 5 November and 2 December 2020 due to the second national lockdown.
11. Mrs X told me she had moved part of her business from a different unit to unit 3 in summer 2020. She said the Council had paid a grant for the previous premises (relating to an earlier period of time) and that the way she operated her business across all three units did not change.
12. Council records did not show Mrs X was the ratepayer for unit 3. Therefore, it asked Mrs X to provide evidence of occupation and trading from the unit for the relevant period on 25 February 2021. Mrs X provided the information via several emails the same day. The Council considered the information provided, including a lease agreement, which stated the permitted use for unit 3 was “storage”. It also considered photographs Mrs X sent it which showed items advertised for sale via social media, which had been photographed in unit 3.
13. The Council was not satisfied that the information provided showed Mrs X was using unit 3 primarily as retail premises. An officer inspected the premises on 9 March 2021 and took photos of all three units, taken from the windows. The officer reported the unit was used for storage and not laid out as a showroom for customers, since there was no customer entrance or till/counter.
14. On 12 March 2021 the Council wrote to Mrs X refusing a grant for unit 3. Its reason was that this unit was mainly used for storage and therefore was not forced to close.
15. Mrs X provided more photos. The Council said these showed she was selling items online but did not prove unit 3 was a retail showroom. Mrs X explained she stored damaged goods in unit 3, advertised them online and customers would view them in unit 3 before deciding whether to buy them. This was to keep separate those items that were damaged from those that were not. She also contacted her MP, who asked the Council to reconsider its decision and forwarded testimonials from two customers who said they had viewed and purchased items from unit 3.
16. The Council’s redeterminations team considered the application and wrote to Mrs X on 19 March confirming the original decision to refuse the grant. It said the lease indicated unit 3 was used for storage. Mrs X’s account was that it was used to store returned and damaged items, of which some were resold online. Whilst it did not dispute customers may occasionally view an item within it, it believed unit 3 was mainly used for storage.
17. Mrs X remained unhappy and complained to us.
18. In its response to my enquiries, the Council explained that it paid a grant to the business in November 2020 for the previous premises, based on the information in its records at the time. However, it had later received information that indicated its record was not accurate.

My findings

19. We are not an appeal body. We can consider whether there was fault in the decision making process. If there was no fault in the process, we cannot comment on the decision reached.
20. Since its records did not show Mrs X was the ratepayer for unit 3, the Council asked for evidence the business was trading from those premises at the relevant time. This was appropriate.
21. The Council considered all the information Mrs X sent it. It also carried out an inspection of the premises and considered the photos the inspector took. It concluded unit 3 was not primarily a retail showroom. This meant it was not required to close as a result of the COVID-19 restrictions in force at the time, which in turn meant the business was not eligible for the grant. It wrote to her to explain its reasons.
22. A separate team reconsidered the application. It considered the information provided by Mrs X and her MP, including Mrs X’s explanation of how the business worked and the photos. It upheld the original decision and wrote to Mrs X to explain its reasons.
23. It was for the Council to decide whether the unit was mainly used for retail. It considered all relevant information and I have not found fault in the way it did so. Therefore, I cannot comment on the conclusion it reached.
24. Mrs X considered the Council acted inconsistently because it had paid a grant for her previous premises. The Council has explained this was because, in that case, its records showed Mrs X was the ratepayer so it had not made enquires to check the information it held was correct. There was no fault in the Council’s actions.

Back to top

Final decision

25. I have completed my investigation. I have not found fault.

Back to top

Investigator's decision on behalf of the Ombudsman