Summary: We have discontinued our investigation of this complaint, about the Council’s handling of a business’s applications for several different COVID-19 support grants. This is because its eligibility rests of the question of its liability for business rates, which is a matter subject to an ongoing appeal to the magistrates’ court. We therefore cannot intervene in the matter.

The complaint

1. I will refer to the complainant as Mr J.
2. Mr J complains the Council has refused his business’s applications for several different COVID-19 support schemes.

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The Ombudsman’s role and powers

3. The Local Government Act 1974 sets out our powers but also imposes restrictions on what we can investigate.
4. The courts have said that where someone has used their right of appeal, reference or review or remedy by way of proceedings in any court of law, the Ombudsman has no jurisdiction to investigate. This is the case even if the appeal did not or could not provide a complete remedy for all the injustice claimed. (R v The Commissioner for Local Administration ex parte PH (1999) EHCA Civ 916)

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How I considered this complaint

5. I reviewed Mr J’s correspondence with the Council, and the notes provided to me by the Council.

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What I found

6. Mr J’s business (which I will call ‘Business A’) is a waste management company, which occupies a unit on an industrial site. Since 2016, its liability for business rates has been subject to a complicated series of investigations and decisions by the Council, flowing from disagreements and confusion about the industrial unit, how it is subdivided, and which other businesses are or have been in occupation of its parts.
7. In 2017, the Council granted Small Business Rates Relief (SBRR) to Business A. In 2019 it cancelled this award, because it considered the business was in occupation of more than one premises, with a combined rateable value above the qualifying threshold for SBRR.
8. In early 2020, Business A disputed this, and said another business was occupying the other premises, but the Council did not accept the evidence Business A provided to support this. In February, Business A complained to the Council about the decision it was liable for the other premises.
9. Business A applied for a grant under the COVID-19 small business grant (SBG) scheme in April 2020. The Council refused this because it was not in receipt of SBRR, which was a qualifying criterion.
10. Business A then applied for grants under the additional restrictions grant (ARG) scheme and restart grants scheme, in January and June 2021 respectively. The Council refused these because it did not consider the business had provided adequate supporting information for the ARG scheme, and because it was not an eligible business-type for the restart scheme.
11. Mr J made a complaint to the Ombudsman in May 2021. Since then, we have been informed Business A has lodged an appeal in the magistrates’ courts, to challenge the Council’s decision on its business rates liabilities.

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Legislative background

12. 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 them.
13. A business’ right to a grant depends on its rateable value on the business rating list and its eligibility for certain business rate reliefs on 11 March 2020. Government guidance states later changes to the rating list, even if they 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 already had good reason to believe the rating list was inaccurate for a particular address or business.
14. The Valuation Office Agency (VOA), not the Council, compiles the rating list and decides on liability for business rates and rateable values.  
15. Not every business appears on the rating list as not all of them have to pay business rates.

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Analysis

16. There is a complex history to this complaint, and, upon consideration, I do not consider it is one the Ombudsman can, or should, investigate at the present time.
17. Mr J says Business A is in occupation of only one part of the unit, while the Council considers it is liable for more than this. Not only does this mean it is pursuing the business for rates which Mr J considers it is not liable for, it also means it is not eligible for SBRR, because the additional liability takes it over the rateable value threshold to qualify for this relief.
18. And, in turn, this means Business A did not qualify for the SBG scheme, because the scheme was only open to businesses in receipt of SBRR.
19. Therefore, while Mr J’s complaint to the Ombudsman is only about the Council’s decision on its application for the grant scheme, this stands or falls on the question of liability. This is a question Mr J has now asked the magistrates’ court to decide, which means the matter is now entirely outside the Ombudsman’s jurisdiction, as explained at paragraph 4.
20. And in fact, even if Mr J had not appealed to the magistrates’ court, we would still not be able to make our own decision on Business A’s liability. The Ombudsman does not provide an alternative route of appeal on such matters.
21. It follows we cannot currently investigate the Council’s decision on Business A’s application to the SBG scheme. The business’s eligibility for the scheme depends entirely on what the magistrates’ court decides, and until it has made its decision, we cannot say whether the Council should have accepted the SBG application.
22. However, if the court finds in Business A’s favour, to the effect its SBRR is reinstated, we would expect the Council to then reconsider its decision on its application to the SBG scheme; and, if appropriate, pay the business an equivalent amount had its application been accepted while the scheme was open.
23. Business A also applied to the ARG and restart grant schemes, both of which the Council also refused.
24. The Council’s notes say it refused Business A’s ARG scheme application because it did not provide adequate information. Elsewhere in the Council’s notes, it explains Business A’s ARG application form said it was in occupation of part of the unit for which it was disputing liability.
25. I am therefore satisfied this part of Mr J’s complaint concerns a matter which is due to be decided by the magistrates’ court. For the same reason, we cannot currently investigate it.
26. And the Council refused Business A’s restart grant application because it was not an eligible business. I do not consider this point is arguable – the restart grant scheme was for non-essential retail, hospitality, leisure, gyms and personal care businesses. Business A is a waste management company. The Council’s refusal of this application is clearly in line with the scheme’s criteria and so there is no evidence of fault here.

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Final decision

27. I have discontinued my investigation of this complaint.

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Investigator's decision on behalf of the Ombudsman