Definitions
The following definitions are used within this page:
‘Additional Restrictions Grant (ARG)’ means the additional funding provided by Government. Funding will be made available to eligible Local Authorities at the point that national restrictions are imposed or at the point the Local Authority first entered LCAL 3 local restrictions;
‘COVID-19’ (coronavirus); means the infectious disease caused by the most recently discovered coronavirus;
‘Department for Business, Energy & Industrial Strategy (BEIS)’; means the Government department responsible for the scheme and guidance;
‘Effective date’; means, for eligibility of the grant, the date of the local restrictions or the date of widespread national restrictions;
‘Hereditament(s); means the assessment defined within Section 64 of the Local Government Finance Act 1988;
‘Local lockdown’; means the same as ‘Local restrictions’;
‘Local rating list’; means the list as defined by Section 41 of the Local Government Finance Act 1988
‘Local restrictions’; and ‘Localised restrictions’ means legally binding restrictions imposed on specific Local Authority areas or multiple Local Authority areas, where the Secretary of State for Health and Social Care requires the closure of businesses in a local area under regulations made using powers in Part 2A of the Public Health (Control of Disease) Act 1984 in response to the threat posed by coronavirus and commonly as part of a wider set ofmeasures;
‘Ratepayer’; means the person who, according to the Council’s records, was the ratepayer liable for occupied rates in respect of the hereditament at the date of the local restrictions or widespread national restrictions;
1.0 Purpose of the Scheme and background
1.1 The purpose of this document is to determine eligibility for a payment under the fifth round of the Council’s Additional Restrictions Grant Scheme (ARG). The Council, as the business rates billing authority, is responsible for payment of these grants.
1.2 Four previous rounds of ARG funding were developed by the Council in response to an announcement made by the Secretary of State for Business, Energy & Industrial Strategy on 31st October 2020 which established and set conditions for an allocation of funding to local authorities titled the Additional Restrictions Grant. Local authorities are given significant discretion on the use of ARG, however Government has stated that it wishes the funding to support businesses which have to close or are otherwise severely affected due to localised or widespread national restrictions being put in place to manage coronavirus and save lives. These grant payments are being administered by local authorities but funded by an allocation from Government.
1.3 The first round of the Council’s ARG scheme opened in November 2020 and closed for new applications in December 2020. The second round opened in January 2021 and closed in March 2021. The third round opened in May 2021 and closed in June 2021. The fourth round opened and closed in June 2021.
1.4 As the Council was successful in distributing its full ARG allocations before the end of June 2021, it was successful in receiving a “top up” from the Government to fund further eligible ARG rounds before the end of March 2022.
1.5 Whilst the awarding of grants is at the Council’s discretion, the Department for Business, Energy & Industrial Strategy (BEIS) has set down criteria which must be met by each business making an application. These criteria are included within this policy.
1.6 Grants under this scheme will be available for the 2021/22 financial year only.
2.0 Funding
2.1 Under the Additional Restrictions Grant Scheme (ARG) provisions, Local Authorities received an initial one-off lump sum payment amounting to £20 per head in each area when local restrictions (LCAL3) or widespread national restrictions are imposed. The Council’s initial allocation was around £1.7 million.
2.2 On 5th January 2021, the Chancellor announced that Local Authorities will receive a further lump sum payment to fund additional activities under the ARG. Each Local Authority will be allocated an additional award based on population and distributed from a total pot of around £500 million. The Council received around £776,000 from this second allocation.
2.3 As it successfully distributed its allocations described above before the end of June 2021, the Council was successful in receiving an additional top up allocation of £614,621 to be spent before the end of March 2022.
2.4 In January 2022, the Council received a further top up of £155,798.33 as a response to new restrictions imposed to combat the Omicron variant. The fifth round scheme to which this policy relates would utilise all remaining funding from the allocations listed below.
2.5 This funding is entirely separate to those received by the Council for use on other grant schemes, including the Restart Grant, Local Restrictions Support Grants and newly-announced Omicron Hospitality and Leisure Grant. These schemes are subject to their own conditions and eligibility criteria and funding will not usually be shared across schemes.
3.0 Eligibility criteria and awards
3.1 The Council is expected to use its Additional Restrictions Grant (ARG) funding for business support activities and Government envisage that this will primarily take the form of discretionary grants to businesses although it can be used to fund wider business support activities where businesses are the direct beneficiaries.
3.2 If Local Authorities use the ARG for direct business support grants, Government has stated that the same overall conditions of grant must apply as for the Local Restrictions Support Grant (Closed) scheme. However, the Council will have the discretion to limit eligibility criteria, alter the amount of funding offered to individual businesses and the frequency of payment.
3.3 When the ARG was first launched, Government stated that local authorities may also consider making grant payments to those businesses which, while not legally forced to close are nonetheless severely impacted by the restrictions put in place to control the spread of Covid-19. Government has also stated that local authorities may also wish to assist business which are outside of the rating system and which are effectively forced to close.
3.4 In December 2021, the Chancellor announced a new round of business support being made available for certain businesses as a consequence of new Coronavirus restrictions imposed to deal with the Omicron variant. This support included a new grant scheme for hospitality and leisure businesses occupying rateable premises (called the Omicron Hospitality and Leisure Grant) and additional discretionary funding, where needed, to support other affected businesses.
3.5 In the same month, local authorities received a letter from Rt Hon Kwasi Kwarteng MP, Secretary of State for Business, Energy and Industrial Strategy which urged them to pay out any remaining ARG funds as quickly as possible and to prioritise those businesses that have been severely impacted by the spread of the Omicron variant.
3.6 The Council also operated a short business survey in December 2021 which requested information from local businesses on how they felt remaining ARG funding should be prioritised.
3.7 The eligibility criteria set out in this policy has sought to support those businesses which are worst affected by the latest Coronavirus restrictions, those sectors identified as needing supported in the business survey, and those sectors which the Government has specifically requested be supported as a priority.
3.8 The Council has around £755,000 in funding remaining after the first four rounds of ARG, inclusive of all allocations and “top ups”. This full remaining amount will be allocated to this new fifth round.
Eligibility Criteria
3.9 In order to receive a grant, the primary activity of a business must meet at least one of the following criteria:
- Indoor hospitality, including pubs/bars, cafes, restaurants and nightclubs
- Indoor accommodation, including hotels, B&Bs, catteries and kennels
- Indoor leisure, including gyms, children’s play areas, theatres, cinemas, bowling and similar
- Indoor personal care, including hair, beauty and non-medical cosmetic treatments
- Suppliers to hospitality, leisure, accommodation or personal care businesses
- Businesses which organise, facilitate or supply events
- Hireable halls and indoor venues
- Travel agents and tour operators
3.10 Notwithstanding Paragraph 3.9, businesses will not be eligible to receive a grant if their primary activity is in any of the following sectors: retail, outdoor hospitality leisure or accommodation, construction, education, health and social care, manufacturing and engineering, agriculture and horticulture, financial and insurance activities, professional services or research and development.
3.11 Where businesses are applying as a supplier, they will be expected to provide documentary evidence of frequently supplying eligible sectors. As a rule of thumb, businesses which cumulatively receive under £1,000 per month in revenue from supplying eligible sectors are unlikely to be considered eligible, however all cases will be considered on their merits. This test is considered necessary to ensure suppliers receiving grants under this scheme are those with the greatest exposure to current Coronavirus restrictions.
3.12 The final level of grant awarded to a business will be calculated once the final number of eligible applicants has been determined. However grants to mobile and domestic-based businesses will be capped at £500. All businesses occupying non-domestic premises will then receive an equal amount proportionate to the amount of funding remaining. The Council reserves the right to adjust this approach, however no business will be eligible to receive more than £5,000 and it is expected the average grant award will be significantly lower than this.
3.13 The Council will not usually award multiple grants to the same business or individual unless that business or individual can clearly demonstrate that it operates multiple premises in Rochford District. The Council reserves the right to refuse any and all payments to any business or individual that is considered to be intentionally making multiple claims for the same business or premises.
3.14 Applicants will be required to provide evidence proportionate to the need to verify that their business is eligible and that the application is not fraudulent. This may include business bank statements, invoices and/or utility bills. Applicants should make every effort to provide this information upfront as the Council reserves the right to refuse applications which are ambiguous, incomplete or contradictory.
Excluded businesses – both local and national restrictions
3.15 Notwithstanding the provisions of Paragraphs 3.9 and 3.10, the following businesses will not be eligible for any award under any circumstances:
- Businesses which primarily operate outside Rochford District;
- Businesses that have chosen to temporarily close but have not been legally required to;
- Businesses which have already received grant payments that equal the maximum levels of State Subsidy and/or State Aid allowable under the conditions of the grant; and
- Businesses that were in administration, are insolvent or where a striking-off notice has been made on or since the 1st January 2021 that has not been quashed at the time of the application being assessed
The Effective Date
3.15 There is no longer a date on which businesses must have started trading to be eligible for a grant. However, where a business is newly formed, the Council will seek to establish whether that business has truly been trading for a sufficient period so as to make any application legitimate. In these instances, the Council reserves the right to request documentary evidence such as business bank statements or invoices to assess how long the business has been trading for.
3.16 For the avoidance of doubt, a business is unlikely to be considered ‘trading’ if it has not yet received necessary regulatory approvals (e.g. licenses); signed a rental agreement for its premises; opened a business rates account; or paid rent, utility or other business costs for a period covering at least 3 months. All cases will, however, be considered on their merits.
Who can receive the grant?
3.17 In all cases, Government has stated that the person who will receive the grant will be the person who, according to the Council’s records, was the ratepayer in respect of the hereditament at the effective date.
3.18 Where the Council has reason to believe that the information it holds about the ratepayer at the effective date is inaccurate, it may withhold or recover the grant and take reasonable steps to identify the correct ratepayer.
3.19 Where it is subsequently determined that the records held are incorrect, the Council reserves the right to recover any grant incorrectly paid.
3.20 Where any business misrepresents information or contrives to take advantage of the scheme, the Council will look to recover any grant paid and take appropriate legal action. Likewise, if any ratepayer is found to have falsified records in order to obtain a grant.
3.17 Where there is no entry in the rating list for the business, the Council will have discretion to determine who should receive the grant.
4.0 How will grants be provided to Businesses?
4.1 The Council is fully aware of the importance of these grants to assist businesses and support the local community and economy.
4.2 Details of how to obtain grants will be published on the Council’s website.
4.3 In all cases, applicants will be required to confirm through an application that they are eligible and wish to receive the grant. This includes circumstances where the Council already has bank details for the business and are in a position to send out funding immediately. Businesses are under an obligation to notify the Council should they no longer meet the eligibility criteria for any additional grants.
4.4 The Council reserves the right request any supplementary information from businesses, and they should look to provide this, where requested, as soon as possible.
4.5 Businesses who believe they are eligible for a grant award under this policy will be required to apply through a standard form on the Council’s website during a defined application window. An application for an Additional Restriction Grant is deemed to have been made when a duly completed application form is received via the Council’s online procedure within this application window and the applicant has subsequently received a reference number as proof of their application.
4.6 The amount allocated to this grant is finite and the final amounts awarded to businesses will be determined once the application window has closed. Grants will not be awarded to businesses whose eligibility cannot be determined within the application window or who fail to apply within the application window or using the appropriate application form.
4.7 All monies paid under this scheme will be funded by Government and paid to the Council under S31 of the Local Government Act 2003.
5.0 EU State Aid requirements
5.1 The EU State aid rules no longer apply to subsidies granted in the UK following the end of the transition period, which ended on 31 December 2020. This does not impact the limited circumstances in which State aid rules still apply under the Withdrawal Agreement, specifically Article 10 of the Northern Ireland Protocol. The United Kingdom remains bound by its international commitments, including subsidy obligations set out in the Trade and Cooperation Agreement (TCA) with the EU. BEIS Guidance for public authorities explaining the subsidies chapter of the TCA, World Trade Organisation rules on subsidies, and other international commitments
5.2 On Thursday 4 March 2021 new subsidy allowances were established for the COVID-19 business grants schemes, on the basis of the principles set out in Article 3.4 of the TCA.
5.3 The following scheme rules are to be applied to COVID-19 business grants on the basis of the EU-UK Trade and Co-operation Agreement (TCA).
5.4 The below scheme rules should be applied to applicants at the level of economic actor, which is defined as an entity or a group of entities constituting a single economic entity regardless of its legal status, that is engaged in an economic activity by offering goods or services on a market.
5.5 There are three subsidy allowances for this scheme set out below: Small Amounts of Financial Assistance Allowance, the COVID-19 Business Grant Allowance and the COVID-19 Business Grant Special Allowance.
Small Amounts of Financial Assistance Allowance
5.6 Grants may be paid in accordance with Article 3.2(4) of the TCA, which enables an applicant to receive up to a maximum level of subsidy without engaging Chapter 3 of the TCA. This allowance is 325,000 Special Drawing Rights, to a single economic actor over any period of three fiscal years, which is the equivalent of £335,000 as at 2 March 20211. An applicant may elect not to receive grants under the Small Amounts of Financial Assistance Allowance and instead receive grants only using the below allowances available under this scheme.
COVID-19 Business Grant Allowance
5.7 Where the Small Amounts of Financial Assistance Allowance has been reached, grants may be paid in compliance with the Principles set out in Article 3.4 of the TCA and in compliance with Article 3.2(3) of the TCA under the COVID-19 Business Grant Allowance (subsidies granted on a temporary basis to respond to a national or global economic emergency). For the purposes of these scheme rules, this allowance is £1,600,000 per single economic actor. This allowance includes any grants previously received under the COVID-19 business grant schemes and any State aid previously received under Section 3.1 of the European Commission’s Temporary Framework across any other UK scheme. This may be combined with the Small Amounts of Financial Assistance Allowance to equal £1,935,000 (subject to the exact amount applicable under the Small Amounts of Financial Assistance Allowance using the Special Drawing Right calculator).
COVID-19 Business Grant Special Allowance
5.8 Where an applicant has reached its limit under the Small Amounts of Financial Assistance Allowance and COVID-19 Business Grant Allowance, it may be able to access a further allowance of funding under these scheme rules of up to £9,000,000 per single economic actor, provided the following conditions are met:
- The Special Allowance covers only the applicant’s uncovered fixed costs incurred during the period between 1 March 2020 and the date of application, including such costs incurred in any part of that period (‘eligible period’);
- Applicants must demonstrate a decline in turnover during the eligible period of at least 30% compared to the same period in 2019. The calculation of losses will be based on audited accounts or official statutory accounts filed at Companies House, or approved accounts submitted to HMRC which includes information on the applicant’s profit and loss;
- ‘Uncovered fixed costs’ means fixed costs not otherwise covered by profit, insurance or other subsidies;
- The grant payment must not exceed 70% of the applicant’s uncovered fixed costs, except for micro and small enterprises (for the purposes of this scheme defined as less than 50 employees and less than £9,000,000 of annual turnover and/or annual balance sheet), where the grant payment must not exceed 90% of the uncovered fixed costs;
- Grant payments under this allowance must not exceed £9,000,000 per single economic actor. This allowance includes any grants previously received in accordance with Section 3.12 of the European Commission’s Temporary Framework; all figures used must be gross, that is, before any deduction of tax or other charge;
- Grants provided under this allowance shall not be cumulated with other subsidies for the same costs.
5.9 An applicant must be able to provide the necessary documentation to demonstrate it is eligible for funding under this COVID-19 Business Grant Special Allowance. Local Authorities must first verify that an applicant can meet all the criteria set out under this allowance before providing further funding under this allowance.
5.10 Grants provided in excess of the Small Amounts of Financial Assistance Allowance may not be granted to applicants that were defined as an ‘undertaking in difficulty’ (as defined in Annex B of the guidance document) on 31 December 2019. In derogation to the above, grants can be granted to micro or small enterprises (as defined above) that were already in difficulty on 31 December 2019 provided that they are not subject to collective insolvency proceedings.
5.11 Local Authorities must ensure the remaining applicable provisions of the subsidies chapter of the TCA are complied with. In particular, the Transparency obligations under Article 3.7. The transparency database can be found at https://manageuksubsidies.beis.gov.uk/. All schemes and individual awards over £500,000 must be uploaded within six months of being granted. Any ad hoc awards of at least 325,000 Special Drawing Rights over three years to an individual beneficiary must also be uploaded within six months of being granted. For access to and any further questions on the database, please contact the BEIS subsidy control team at subsidycontrol@beis.gov.uk
6.0 Scheme of Delegation
6.1 The Council has approved this scheme.
6.2 Officers of the Council will administer the scheme and the Assistant Director, Place and Environment is authorised to make technical scheme amendments to ensure it meets the criteria set by the Council and, in line with Government guidance.
7.0 Notification of Decisions
7.1 All decisions made by the Council shall be notified to the applicant either in writing or by email. A decision shall be made as soon as practicable after an application is received.
8.0 Reviews of Decisions
8.1 There will no right to appeal decisions made under the scheme. Applicants should therefore make sure they read the application form thoroughly and provide all the information requested.
8.2 Where the Council writes to applicant requesting clarification or further evidence, applicants should seek to provide this information before the deadline given, which will usually be no shorter than a week. Applicant should alert the Council as quickly as possible if they are unable to meet this deadline. The Council reserves the right to refuse applications where applicants fail to respond to requests before given deadlines without good reason.
8.3 Applicants can nevertheless request a written reason for any decision made within 14 days of receiving a decision letter.
9.0 Complaints
9.1 The Council’s ‘Complaints Procedure’ (available on the Councils website) will be applied in the event of any complaint received about this scheme.
10.0 Taxation and the provision of information to Her Majesty’s Revenues and Customs (HMRC)
10.1 The Council has been informed by Government that all payments under the scheme are taxable.
10.2 The Council does not accept any responsibility in relation to an applicant’s tax liabilities and all applicants should make their own enquiries to establish any tax position.
10.3 All applicants should note that the Council is required to inform Her Majesty’s Revenue and Customs (HMRC) of all payments made to businesses.
11.0 Managing the risk of fraud
11.1 Neither the Council, nor Government will accept deliberate manipulation of the schemes or fraud. Any applicant caught falsifying information to gain grant money or failing to declare entitlement to any of the specified grants will face prosecution and any funding issued will be recovered from them.
11.2 Applicants should note that, where a grant is paid by the Council, details of each individual grant will be passed to Government.
12.0 Recovery of amounts incorrectly paid
12.1 If it is established that any award has been made incorrectly due to error, misrepresentation or incorrect information provided to the Council by an applicant or their representative(s), the Council will look to recover the amount in full.
13.0 Data Protection and use of data
13.1 All information and data provided by applicants shall be dealt with in accordance with the Council’s Data Protection policy and Privacy Notices which are available on the Council’s website.