Our ask to Local Government: Small & social businesses MUST be able to access discretionary top-up fund easily & speedily

Last week The Business Secretary Alok Sharma announced a ‘discretionary’ fund to accommodate certain small businesses which were previously outside the scope of the business grant funds scheme, simply because of how they pay their business rates.

The announcement followed a lobbying effort led by Liverpool-based social enterprise, The Women’s Organisation, with several Liverpool City Region MPs, CEO’s and business leaders from across the Liverpool City Region adding their support. (Find out more here).

While this new £617 million discretionary fund has been welcomed as a vital lifeline for private and social businesses, The Women’s Organisation and Enterprise Hub - Liverpool City Region’s “one front door” for business support - have today written to Local Authority leaders and Cabinet Members with two key asks to ensure businesses can access the support easily and speedily.

Firstly, to ensure that Local Government expedite grant payments to SMEs and Social Businesses and secondly to ensure that is it not an onerous task for businesses to access.

Helen Millne, Deputy CEO of The Women's Organisation, (left)
with CEO, Maggie O'Carroll (right)

Maggie O’Carroll, CEO of The Women’s Organisation, says: “The priority is to get that resource out to businesses as matter of urgency as many have ongoing businesses costs and reduced income during the lockdown period. As we look forward to an easing of restrictions it will be crucial that they have the cash to aid them now and in their recovery.  

“We hope that urgency, pace and flexibility are the watchwords attached to this process and are asking for support and leadership from Local Authority leaders and Cabinet Members in ensuring that authorities right across the Liverpool City Region can expedite claims immediately and use a simple process which also protects the public purse from any attempted fraud.”

Helen Millne, Deputy CEO of The Women’s Organisation, and National Growth Programme Board member, added: “There is a concern if officials decide on a process which involves officers doing individual business assessments on proving reduced income that the grants will be unnecessarily delayed. 

“What’s more, businesses that have been in touch with their respective local authorities are being told that there is very little money and it’s a first come first serve basis. Given that there is a significant underspend in the previous round of grant resource, this is not a helpful for already distressed small business owners and social enterprises.”

In the letter issued today, The Women’s Organisation and Enterprise Hub have updated their original suggestions, as were put forward to local government and Alok Sharma MP, to reflect the discretionary fund: 

Issue 1

Businesses that operate from managed workspaces or incubators will often pay a contribution to a shared business rates where one rateable value is applied to the whole building within their tenancy or licence agreement. Indeed, this is often advised as the most appropriate method for business rates collection by the Business Rates Office when tenancy agreements are often “easy-in-and-easy-out” and would mean a lot of change in billing. 

Solution 1

Upon receipt of appropriate evidence the grant is paid to businesses with tenancies in properties with shared business rates. To prevent any fraud the following measures could also be added to check the veracity of the grant claim:

The local authority may ask:

- Managing agents or landlords to provide a declaration including a list of all legitimate tenants, including company name, size of space occupied, and confirmation that they have been paying  a contribution to the business rates prior to 11^thMarch 2020; 

- Businesses to provide their most recent tax return showing that business address and a copy of their licence/tenancy agreement; a second form of evidence such a bank statement and a copy of their licence/tenancy agreement and;
- In the application form produced by the Local Authority indicate by a tick box that their income has reduced since the onset of the crisis (as it will not be possible for officials to make a judgement on this and there simply won't be a timely evidence base to assess).

Issue 2

Social enterprises can have many structures, including charitable status. It has been suggested that as these small businesses receive mandatory relief for charities and not Small Business Rates Relief that they may  not be eligible for this additional grant from their Local Authority. 

Solution 2

We would ask that it be confirmed that Social Enterprises with the appropriate rateable value and receiving mandatory relief for charities will be eligible for this grant.

You can catch up with the original story and find out how The Women's Organisation lobbied Government on this issue, here: https://thewomensorganisation.blogspot.com/2020/04/thousands-of-businesses-missing-out-on.html
For more information on the support available through The Women's Organisation please contact hello@thewo.org.uk