Summary: Mr X complained the Council wrongly refused COVID-19 business grants, causing upset and distress. The Council decided the grant applications in line with relevant Government Guidance and was not at fault.

The complaint

1. Mr X complained the Council wrongly refused a Local Restrictions Support Grant (LRSG). He said it initially refused because the premises was not an office and later refused because it was an office. Mr X said the Council had treated him unfairly and this had caused a lot of upset and distress.

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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)

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How I considered this complaint

5. I considered the information provided by Mr X and the Council, and relevant Government Guidance, as set out below.
6. Mr X and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

Relevant Government Guidance

Local Restrictions Support Grant (Closed) Addendum (LRSG)

7. The Government provided support to businesses forced 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.
8. Eligible businesses were those required to close in line with Government restrictions. The Health Protection (Coronavirus, Restrictions) (England) (No. 4) Regulations 2020 sets out which businesses had to close by law. This included non-essential retail, leisure, personal care, sports facilities and hospitality businesses.

Restart grant

9. 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.
10. The Guidance set out the types of businesses that could be considered non-essential retail and specifically excluded some business types including storage and distribution facilities and office buildings. However, those lists were not exhaustive and the Guidance said it was for councils to determine those cases where eligibility was unclear.

What happened

11. Mr X operates a business, which involves selling beds and furniture. The business leases a ground floor unit in an office building owned by another business operated by Mr X.
12. On 30 December 2020, Mr X applied for a Local Restrictions Support Grant (LRSG). On the application form he said the business was a retailer of furniture and beds, and said it was forced to close on 5 November 2020 as a result of the second national lockdown.
13. The Council refused the grant on 8 January 2021 because it said the business premises was not legally required to close. In response to my enquiries, it provided an internal record that showed this was because its records indicated the premises was used for storage.
14. Mr X challenged the decision on 16 January 2021. He said he dealt with customers face to face on a daily basis as a retailer of beds and furniture so was forced to close during the national lockdowns.
15. On 26 February 2021, the reconsiderations team asked Mr X to provide the following:
• photos of the showroom, entrance to the shop and retail counter;
• an explanation of how the business worked, whether it was open to the general public or sold items to other shops;
• bank statements showing sales from July to October 2020;
• evidence the business was forced to close, including whether Mr X was given advice to close;
• evidence of any advertising and any communications with his customer base stating the business would be closed during the lockdown periods; and
• proof of public liability insurance for 2020.

The Council did not explain why it needed this information or give Mr X a deadline for providing it.

16. On 22 March 2021, Mr X made an online complaint. He said the Council had wrongly refused the grant and he believed the business was eligible because it:
• was based in England;
• occupied business premises and paid business rates;
• was forced to close in the second and third lockdowns; and
• was unable to provide its usual in-person customer service from its premises.

He added that he needed to see customers face to face before “signing them up”.

17. The Council acknowledged receipt of the complaint, which it said it had passed to its reconsiderations team.
18. On 31 March 2021, Mr X complained the Council had not responded to his complaint. The business rates team provided a further copy of the email dated 26 February 2021. In response, Mr X said the Government criteria did not state he needed to provide the information requested so he was not going to waste his time providing it.
19. On 10 April 2021, Mr X asked the business rates team for an update on the Restart grant. The business rates team replied on 15 April. It said that the business was not eligible for the LRSG because it was not forced to close, which meant it was not entitled to restart payments.
20. On 19 April the reconsideration team sent a further email asking for Mr X to provide the information and evidence set out at paragraph 15. It said the information was needed to reconsider his grant application. It asked Mr X to provide the information by 30 April 2021. Although this was sent to the same email address used until this point, the email was returned “undelivered”. The Council therefore sent a letter containing the same information, also on 19 April 2021.
21. On 13 May 2021, the Council wrote to say that as it had not received any further information from Mr X, the original decision would stand.

My findings

22. Mr X applied for a LRSG during the second national lockdown. Government Guidance said eligible businesses were those forced to close by law. The Council had no discretion about this.
23. It was not fault for the Council to initially refuse the grant on the basis its records stated the premises was used for storage. Premises used for storage were not required to close.
24. When Mr X challenged the decision, stating the business was a retailer, the Council asked for evidence of this, which was appropriate to enable it to decide whether the business was forced to close. Although the reconsideration team requested the information on two occasions, including by email and by post, Mr X did not respond and he told the business rates team he did not intend to provide it. The Council gave Mr X an opportunity to provide relevant evidence to support his appeal. In the absence of any additional evidence, it was entitled to conclude the original decision should stand and was not at fault. Although it could have provided a more detailed explanation of why it needed the additional information, this is not sufficient to amount to fault.
25. When Mr X asked about the Restart grant, the Council said the business was not entitled to this as it was not forced to close. It did not make any reference to the appeal, which its reconsideration team were considering. If the reconsideration team had decided the business was eligible for the LRSG I would have expected it to also reconsider the Restart grant. However, premises used for storage were expressly excluded from this scheme so in the absence of evidence to show the premises was, in fact, used for retail purposes, the Council was correct to say the business was not eligible for the Restart grant. In the circumstances, although the communication with Mr X could have been clearer, I do not consider it was so poor that it amounted to fault.

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Final decision

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

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Investigator's decision on behalf of the Ombudsman