Summary: We will not investigate Miss X’s complaint about her application for a business grant available due to COVID-19. This is because there is not enough evidence of fault by the Council.

The complaint

1. The complainant, whom I shall call Miss X, complains about the Council’s decision that her business is not eligible for a grant available due to COVID-19.

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The Ombudsman’s role and powers

2. 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”.
3. 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’. We provide a free service, but must use public money carefully. We may decide not to start or continue with an investigation if we believe it is unlikely we would find fault. (Local Government Act 1974, section 24A(6), as amended)

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How I considered this complaint

4. I considered Miss X’s complaint to us and the information she provided. I considered the relevant statutory guidance. I also gave Miss X the opportunity to comment on a draft statement before reaching a final decision on her complaint.

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What I found

5. The Government introduced the Local Restrictions Support Grant (‘LRSG’) (Closed) scheme to help businesses required to close from November 2020 due to COVID-19. Eligible businesses were those mandated to close by the Government and included non-essential retail, leisure, personal care, sports facilities, and hospitality businesses.
6. Miss X applied for an LRSG (Closed) and her application was successful. But in January 2021, the Council wrote to Miss X and said she needed to repay the grant. The Council said her business, which is a café, only has outdoor seating and it had not been mandated to close.
7. Unhappy with the decision, Miss X complained to the Council. She said the business offered an “in-person” service pre-lockdown which it could no longer do. She quoted a section on eligibility for the LRSG (Closed) from the Government’s website which said:

“You will need to show that your business…has been unable to provide its usual in-person customer service from its premises…For example, this could include pubs and restaurants that operate primarily as an in-person venue, but which have been forced to close those services and provide a takeaway only service instead.”

8. Miss X said that before lockdown customers could sit outside. Now, the café only offers a takeaway service. She said “This is very clearly a move from in-person dining to takeaway only”.
9. In its final response to Miss X the Council said:

• The LRSG (Closed) was for businesses mandated to close.
• The Council originally assumed Miss X’s café was more than a takeaway but a visit had shown there was no internal seating.
• Because the business could run as normal it was not eligible to receive the grant.

10. I understand Miss X is disappointed by the Council’s decision. But we are not an appeal body. We can only criticise decisions if there is enough fault in the decision-making process to call into question the decision itself.
11. I do have some concerns about how the Council has explained its decision to Miss X. For example, it says Miss X’s business can operate as normal. I do not consider that to be the case as she has needed to remove the small number of outside tables. It also says the small number of outdoor seats at her business should not be considered. I am not clear how it has decided this.
12. But, despite my concerns about how the Council has explained its decision, this does not mean the decision itself is flawed. The LRSG (Closed) was for businesses which were mandated to close. This included hospitality businesses, such as pubs, restaurants, and cafés. Such business could, however, still offer takeaway services.
13. In paragraph 7 I have included a quote from Miss X where she refers to information on the Government’s website. This is an example of a hospitality business which might be eligible for the grant. But I note it refers to “pubs and restaurants that operate primarily as an in-person venue”. The word ‘primarily’ would seem to be the key term here. Having viewed images of Miss X’s business I do not consider it to be ‘primarily’ an in-person venue. Due to the small number of tables and chairs I do not see how it could be. It is instead primarily a takeaway service and has continued to operate in this way.
14. The Government has also issued Statutory Guidance on the LRSG (Closed) and this says:

“If a business is required to close its main, in-person service but adapts its business to operate a takeaway…it will be considered closed and be eligible to receive grants under this scheme because its substantive business must close.”

15. Miss X argues she has had to close the main ‘in-person’ service her business offers, and I see no reason to dispute this. Customers can no longer sit at the small number of tables / chairs outside. But as I say above, and as the Council decided, the business operated primarily as a takeaway. This is its ‘substantive’ business. It has not therefore been required to close its ‘main’ in person service and to operate instead as a takeaway – it always operated as one. It cannot therefore be considered closed and eligible for the grant.
16. The Council could have explained its decision to Miss X more clearly. But I do not think there is enough evidence of fault in the decision itself to warrant an investigation. We will not therefore investigate Miss X’s complaint.

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Final decision

17. We will not investigate Miss X’s complaint. This is because there is not enough evidence of fault by the Council.

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Investigator's decision on behalf of the Ombudsman