Summary: Mr X complained the Council wrongly refused a COVID-19 business grant causing financial loss. There was no fault in the way the Council considered the grant applications.

The complaint

1. Mr X complained the Council wrongly refused a Local Restrictions Support grant and Restart grant. He said the Council ignored the information he provided and failed to apply the correct criteria. He said the lack of support caused financial loss and upset.

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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 Mr X and the Council provided.
6. Mr X and the Council had an opportunity to comment on my draft decision and I considered their comments before making a final decision.

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What I found

Background

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. At part 3, there was a list of businesses permitted to remain open, which included taxi and vehicle hire 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 taxi and vehicle hire businesses. 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)

11. 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.
12. The Guidance 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.
13. This Council’s discretionary scheme was decided in line with Government Guidance. To be eligible, the business had to:
• 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 will 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

14. Mr X operates a business that provides replacement vehicles for taxi driver clients who have had a road accident.
15. He applied for a Local Restrictions Support Grant (LRSG) on 9 December 2020. On the application form he started the business was “retail” and was forced to close during the second national lockdown from 5 November 2020.
16. The Council refused the grant on 10 December 2020. Its reason was that the application was made using an old business rates account number. It provided a link for Mr X to request a copy bill to obtain the correct account number, if needed.
17. Mr X said he applied for a copy bill on 29 December 2020. He emailed the Council on 16 January 2021 to complain he had not received the copy bill, which he needed for his grant application. A copy bill was issued on 3 February 2021, following which Mr X reapplied for the grant.
18. On 10 April 2021, Mr X said he had not heard from the Council about the Restart grant. The Council replied on 15 April. It said it had not received an application for the current grant schemes but, as a taxi service, the business was not eligible for the LRSG nor the Restart grant. It provided a link to further information on its website.
19. Also on 14 April, Mr X emailed the Council to explain he did not operate a taxi business. Rather the business provided replacement vehicles for taxi drivers who had had an accident. He said the business had to close because it operated by seeing clients face to face. He did not consider the link the Council provided was relevant to his business.
20. On 20 April 2021, the Council confirmed the business was not eligible for the LRSG or Restart grant.
21. Mr X complained on 23 May 2021. He said the Council had initially rejected his application without asking him about the nature of the business. He said it rejected it a second time without taking into account the information he provided. He also said it had not applied the Government criteria correctly and was wrong to suggest he should apply for a discretionary grant.
22. On 25 May 2021, the Council confirmed its decision to refuse was correct and that this was its final decision. Mr X complained to us.
23. The Council confirmed Mr X had not applied for an ARG discretionary grant.

My findings

Local Restrictions Support Grant (LRSG)

24. Initially Mr X applied using incorrect information. There was a short delay in providing a copy of the business rates bill to enable him to reapply but this was not sufficient to warrant a finding of fault. The Council did not receive a further application but did respond to Mr X’s emails about the grant, including considering whether his business was eligible and providing reasons for refusing.
25. Mr X applied for a LRSG for the period of the second national lockdown. Government Guidance said eligible businesses were those forced to close by law. Mr X’s business was not one that was on the list of businesses forced to close. In addition, taxi and vehicle hire businesses were specifically listed as being able to remain open, and it was open to the Council to decide Mr X’s business was similar to these and therefore not forced to close. It would have been better if it had responded to the comments Mr X made in his appeal so Mr X could see how it had considered his comments, but this is not sufficient to justify a finding of fault and, in any case, did not affect the outcome.

Restart grant

26. The Council also refused a Restart grant. Again, taxi and vehicle hire businesses were expressly excluded from this scheme, and it was open to the Council to conclude Mr X’s business was similar to those businesses and therefore not eligible for the grant. There was no separate appeal against this refusal.

Discretionary grant

27. Mr X said the Council was wrong to suggest he applied for a discretionary grant. As explained above, the ARG discretionary scheme was for businesses that were not forced to close but had been severely affected by COVID-19 restrictions.
28. Having considered the detail of the scheme, it does not appear that Mr X’s business fell within one of the eligible sectors for a discretionary grant. However, I would not expect the business rates team to know the detail of the discretionary scheme since that scheme was administered by another team. It was appropriate for it to suggest this possibility was explored and so this was not fault.
29. The Council confirmed it did not receive an application for an ARG discretionary grant.

Final decision

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

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Investigator's decision on behalf of the Ombudsman