Summary: Mr X complained the Council wrongly refused COVID-19 business grants. There was no fault with the way the Council considered his grant applications.

The complaint

1. Mr X complained the Council wrongly refused a Local Restrictions Support Grant (LRSG) and Restart grant. He said the lack of support added to the financial difficulties caused by the COVID-19 pandemic.

Back to top

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. 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)
4. 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”.
5. 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

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

Back to top

What I found

Relevant Law and guidance

Local Restrictions Support Grant (Addendum) (LRSG)

8. The Government issued Guidance on 4 November 2020, to support businesses required to close during the second national lockdown from 5 November to 2 December 2020. This was later extended to cover the third national lockdown from 5 January to 31 March 2021.
9. Eligible businesses were those ordered to close by Government. This included non-essential retail, leisure, personal care, sports facilities and hospitality businesses. The Health Protection (Coronavirus, Restrictions) (England) (No. 4) Regulations 2020 sets out which businesses had to close by law from 5 November 2020. Part 2 of the schedule sets out those that must close.

Restart grant

10. Support was provided to support specific types of business, including non essential retail businesses, to enable them to reopen safely after restrictions were lifted following the third national lockdown. To be eligible, the business must:
• be the liable ratepayer on 1 April 2021;
• be engaged in offering in-person services in the relevant sectors; and
• trading (engaged in business activity) on 1 April 2021.
11. The Guidance set out the types of businesses that could be considered non-essential retail and specifically excluded some business types including vehicle repair and MOT businesses and offices. However, those lists were not exhaustive and the Guidance said it was for councils to determine those cases where eligibility was unclear.

Additional Restrictions Grant (ARG)

12. The Government also provided discretionary funding for councils to support businesses that were required to close or had been severely impacted by the second national lockdown.
13. The Guidance, issued on 4 November 2020, said councils could decide how much funding to provide to businesses and which businesses to target. Councils could use the funding to support businesses that were important to its local economy.
14. The Guidance also said:

“In taking decisions on the appropriate level of grant, [councils] may want to take into account the level of fixed costs faced by a business in question, the number of employees, whether they are unable to trade online and the consequent scale of coronavirus losses”.

15. This Council’s discretionary scheme was decided in line with Government Guidance. To be eligible, the business must:
• Be trading in Kirklees;
• Have been open and trading as usual before the restrictions;
• Have been legally required to close or have been significantly impacted by local restrictions from 5 November 2020. Businesses not forced to close would be required to provide evidence demonstrating a significant impact on turnover/sale as a result of stricter social distancing being implemented;
• Be operating in one of more of the following sectors:
1. independent non-essential retail;
2. leisure;
3. hospitality;
4. visitor accommodation;
5. personal care and close contact services;
6. retail, hospitality, leisure supply chain;
7. entertainment and tourism (including events and supply chain businesses); and
8. community facilities/centres, including faith-based venues.

What happened

16. Mr X operates a business that acts as a broker for vehicle repairs.
17. On 1 December 2020, Mr X applied for a Local Restrictions Support Grant (LRSG). On his application he described the business as retail: car and/or vehicle showrooms and other premises.
18. The Council refused the grant on 7 December 2020. It said this was because vehicle repair workshops were permitted to remain open and provided a link to further information about grants on the Gov.uk website.
19. Mr X appealed on 29 December 2020. He explained the business did not carry out repairs but acted as a “compare the market” style broker. This meant it sourced either the cheapest garage to carry out the repairs or the garage that could carry out the work the earliest. To do this, he needed to see the client in person and may need to inspect the vehicle to assess the damage.
20. Mr X sent a chaser email on 16 January 2021.
21. The Council’s reconsideration team reviewed the application. It sent Mr X its decision on 26 February 2021. It said it upheld the original decision to refuse since the business was not required to close. It said if the business was severely impacted by the restrictions it could consider a discretionary grant.
22. Mr X strongly disagreed with the decision. He said:
• the Council had not taken into account the comments in his appeal;
• the business had to close because it could not continue to see clients face-to-face; and
• he wanted the Council to treat this as a formal complaint.
23. On 10 April 2021, Mr X asked about the Restart grant. The Council responded on 15 April 2021 to say that as the business was not forced to close, it was not eligible for a Restart grant. Mr X responded the same day. He said he totally disagreed with the Council, although he did not explain his reasons, and asked for an update on the formal complaint.
24. On 27 April 2021 the Council responded to the complaint. It said it had nothing further to add to previous communications and went on to state:
• the application was refused because it did not meet Government criteria because vehicle repair workshops were not required to close;
• its appeals team had reconsidered the application and upheld the decision;
• Mr X could apply for a discretionary grant if the business was severely impacted by the restrictions.
25. The Council considered whether the business was eligible for a discretionary grant, based on the information he had already provided. Its record shows it noted the business acted as a broker between vehicle repair businesses and clients. It noted this was not one of the eligible sectors for the scheme. Therefore, it refused the discretionary grant on 16 March 2021 for that reason, and provided a link to further information about assistance for businesses on the Gov.UK website.

My findings

26. Mr X applied for a LRSG during the second national lockdown. Government Guidance said eligible businesses were those forced to close by law. Vehicle repair and MOT centres were on the list of businesses that could remain open, as were office-based businesses. Although Mr X says his business does not actually carry out repairs it was not listed as a type of business required to close. The Council had no discretion about this. Although Mr X disagrees, the Council’s decision was in line with Government Guidance and there was no fault in the way it considered the LRSG application.
27. It would have been good practice for the Council to respond specifically to the points Mr X made in his appeal to show how it had considered them. However, I am satisfied the Council gave Mr X sufficient information about its reasons and therefore this does not warrant a finding of fault.
28. The Council refused the Restart grant because the business was not forced to close and Restart Grants were specifically to help businesses to reopen safely. In any case, vehicle repair and MOT services were specifically excluded from the scheme as were office premises. Although the business was not actually carrying out the repairs, the Guidance said it was for the Council to determine if a business was similar to those listed. It was open to the Council to refuse the grant on that basis. I have found no fault in the way it considered the Restart grant application.
29. The Council also considered whether Mr X’s business was eligible for an ARG discretionary grant because it was significantly impacted by COVID-19 restrictions. It decided it was not one of the eligible sectors covered by the scheme. This decision was in line with the published scheme and there was no fault in the way it considered this.
30. It was not fault for the business rates team to suggest a discretionary grant was considered. I would not expect the business rates team to know the detailed criteria for the discretionary scheme, which was administered by another team. Where the business rates team had refused a grant, it was appropriate for it to consider whether the business could benefit from a discretionary grant, and to refer the case to the relevant team to consider that.

Back to top

Final decision

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

Back to top

Investigator's decision on behalf of the Ombudsman