Summary: Mr X complained the Council refused all applications for COVID-19 business support grants from January 2021 onwards causing financial difficulties. Since making his complaint to the Ombudsman, the Council has made a payment to Mr X under a later stage of the Additional Restrictions Grant. There is no evidence of fault in how the Council dealt with Mr X’s grant applications.

The complaint

1. Mr X complains the Council refused all applications for COVID-19 business support grants from January 2021 onwards causing financial difficulties.

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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. 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. As part of the investigation, I have:
• considered the complaint and the documents provided by the complainant;
• made enquiries of the Council and considered the comments and documents the Council provided;
• discussed the issues with the complainant;
• sent my draft decision to both the Council and the complainant and invited their comments.

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What I found

Additional Restrictions Grant Fund

6. On 31 October 2020 the government announced that national restrictions would be reintroduced. Enhanced business support settlements that had previously been provided to areas entering Tier 3 restrictions were extended and formalised into the Additional Restrictions Grant.
7. The ARG funding is a discretionary scheme that aims to support businesses severely impacted by coronavirus restrictions. All businesses that are trading and meet other eligibility criteria may apply to receive funding under this scheme. Government guidance said applications are required under this scheme for new applicants.

Council’s scheme

8. The Council had different stages of the ARG scheme. The initial stage of the scheme was aimed at businesses mandated to close. It introduced the ARG premises grant to support organisations with commercial premises that had been severely impacted by restrictions but unable to access government grant assistance.
9. It said it was expanding the ARG scheme to help businesses permitted to remain open but whose trade had been significantly affected by the absence of workers, commuters and tourists in the city and town centres due to lockdown restrictions. It specifically named sandwich shops/delis, essential retailers in markets and coffee outlets in railway stations as eligible.

Restart grant

10. Support was provided to support specific types of business, including hospitality 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 said a hospitality business could be defined as a business whose main function was to provide a venue for the consumption and sale of food and drink. It said the definition of a hospitality retail business should exclude food kiosks and businesses whose main service is takeaway.

Key facts

12. Mr X operates a sandwich shop which serves nearby offices. Mr X says his business was significantly affected as a result of the lockdowns and people working from home. Mr X closed his shop for a period of time but when he was open, says trade was only about 25% of normal levels.
13. During the lockdowns in November 2020 and January 2021, Mr X was not required to close his business. He contacted the Council in January 2021 enquiring about eligibility for the Local Restrictions Support Grant (LRSG). The Council explained Mr X was not entitled to the LRSG (closed) because his business was not mandated to close.
14. On 22 January 2021, Mr X submitted an application for the Additional Restrictions Grant (ARG). On 29 April 2021 the Council emailed Mr X saying it had assessed his entitlement to the Restart Grant but he was not eligible because he did not offer a mainly in person service at the property where business rates are paid as he primarily operated as a take-away.
15. The Council says that Mr X did not qualify for the early stages of the ARG as it was targeted at business mandated to close and were unable to trade. The Council emailed Mr X on 7 May 2021 explaining he did not currently meet the eligibility criteria for the ARG. It advised him that as further funding was released, his business may qualify for a payment. It said it would keep the application live and reassess it when it released new criteria. It explained Mr X would not need to re-apply.
16. Mr X continued to correspond with the Council about his grant eligibility. In one email he said he was at a loss to understand how a sandwich shop is deemed essential and that he really needed financial help. The Council’s responses explained again that he was not currently eligible for the ARG but his application was “live” and it would review eligibility in line with any new criteria.
17. Mr X complained to the Ombudsman in August 2021, frustrated about the lack of support from the Council.
18. The Council wrote to Mr X on 2 November advising that his business now qualified for the latest stage of the ARG. The application was approved and the grant payment made on 24 December 2021.

Analysis

19. Mr X complains the Council refused all applications for COVID-19 business support grants from January 2021 onwards. Mr X has not been specific about the grants he applied for. When Mr X contacted the Ombudsman, he had not received any payments. He has now received an ARG payment.
20. Mr X’s business was not mandated to close and so he was not eligible for the LRSG (closed). When he applied for the ARG in January 2021, he was not eligible but the Council was clear there would be further funding rounds and his application would be considered under any new criteria. This happened and the Council paid Mr X the ARG in December 2021.
21. I find no fault in how the Council dealt with Mr X’s ARG application. The Council’s initial refusal of Mr X’s application clearly explained the reasons for refusal. It also gave an undertaking to re-consider his application when further rounds of the ARG were released with different criteria and it did what it promised.
22. Mr X mentions the Restart Grant and complains that he was not given this. The Council explained to Mr X that he was not entitled to this grant as he did not provide in-person services. The criteria for this grant said that businesses whose main service is a takeaway should be excluded. Mr X’s business as a sandwich shop is mainly takeaway and so I am not persuaded there is any fault in the Council’s decision to refuse this grant.
23. In his complaint, Mr X mentioned another grant of £2,000 he considered he was entitled to. Mr X has been unable to name this grant or provide any further details. It is my understanding this was part of the Council’s first phase of the ARG scheme and was payment for businesses without premises that were mandated to close. This grant was payable to self-employed individuals who were registered for self assessment or self employed and had been unable to access other support. The Council says that as Mr X had business premises and was not mandated to close, he was not entitled to this grant payment.

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Final decision

24. I will now complete my investigation as there is no evidence of fault in this case.

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Investigator's decision on behalf of the Ombudsman