Cash help coming for Lancashire businesses hit by Covid restrictions

Lancashire businesses affected by the Tier 3 Covid restrictions in force in the county over the last three weeks - and the full-scale lockdown that has now begun – should be able to seek promised financial support within days.

Saturday, 7th November 2020, 9:19 am
Updated Saturday, 7th November 2020, 9:22 am

Councils across the county are currently drawing up plans for government-funded local schemes to make discretionary payments to hard-hit firms – with some even moving to use their own reserves so they can hand out the money before receiving it themselves.

The cash will ultimately come from the £30m grant secured by Lancashire leaders ahead of the introduction of the Tier 3 rules last month, which saw businesses including non-food pubs and bars forced to shut.

As the Local Democracy Reporting Service (LDRS) revealed earlier this week, the funding has still not been received by the county, after ministers demanded that the 12 district and two unitary councils in the region come to a unanimous agreement about how it should be split between them.

Businesses have been waiting weeks for the financial help to cope with Covid restrictions

However, they were also awaiting guidance from the government about exactly how the local schemes should operate – information which has now arrived.

According to advice sent to councils – and seen by the LDRS – they can expect the cash to follow suit by the end of next week.

It is also understood that the government is now likely to accept the majority agreement reached amongst Lancashire’s leaders that the money should be divided up based on the size of the population in each area – a so-called “per capita” split.

All of the developments in recent days have given councils the confidence to start devising their plans and dishing out the financial help that many firms are relying on to get them through.

Affected businesses in those parts of Lancashire which were subject to additional localised restrictions at any point since the summer – which encompasses the whole county as of 26th September – will also be entitled to backdated support for the relevant period.

THIS IS HOW IT WILL WORK

There are likely to be slight variations in the operation of - and application process for - each local scheme.

However, the general entitlements are:

Additional Restrictions Grant

Funded by Lancashire’s £30m Tier 3 deal, this is the discretionary fund which is currently being finalised in each council area and is expected to be launched by most authorities in the coming week.

It is designed to support businesses that may be severely impacted by Tier 3 or lockdown restrictions even if they are not themselves obliged to close under the regulations.

The money can also be used to provide extra support to closed businesses whose costs are not met by the flat-rate grant to which they are entitled (see below) or are unable to access that funding because they do not have a rateable value.

Local Restrictions Support Grant (Closed)

A mandatory grant to cover each four-week period that businesses with a rateable value were forced to close either under Tier 3 restrictions or the current full lockdown.

Businesses with more than one qualifying property will receive more than one grant.

These grants are already largely available upon application.

Payments for eligible businesses with properties with a rateable value of:

£15,000 or under - £1,334 per four weeks;

Over £15,000 and below £51,000 - £2,000 per four weeks;

£51,000 or over - £3,000 per four weeks.

Local Restrictions Support Grant (Open)

Discretionary fund to be operated by councils to help hospitality and leisure businesses in areas under local restrictions at any time between 1st August and 4th November and whose income was significantly affected even though they were able to remain open.

The government has funded the grant at 70 percent of the levels outlined above for closed businesses. However, councils will be able to distribute the cash as they see fit for their own area, meaning different sectors may receive different amounts in different parts of the county.

Sources: Ministry of Housing, Communities and Local Government and the Institute for Fiscal Studies

WHAT THE COUNCILS SAY

Chorley

Council leader Alistair Bradley said: “We are working through [the guidance on grants for business] so we can get the money out to those who need it as soon as possible. We’ve already been in dialogue with businesses as we know how important this funding is and we will be paying it out while we haven’t received a penny yet from the government three weeks after the promise of funding was agreed for Lancashire.

“It’s a shame the government hasn’t been clearer or quicker with their guidance so we can get on with this sooner. Our message to businesses is that we are here to help and we will be sharing details as soon as we can.”

Fylde

A spokesperson said: “Every local authority is trying to set up at least four, if not five, different grant schemes for different periods with different eligibility based on guidance issued on Tuesday night at 7pm

“As soon as the procedures, policy and application processes for the schemes can be completed, then every local authority will be looking to [support] eligible businesses as soon as possible, whether the funds have come in from central government or not.

“The challenge is not the funds, it is making sure the right schemes are in place to ensure the right grants go to the businesses that need it the most.”

Lancaster

The Post understands that Lancaster City Council made its first discretionary Tier 3 payments to businesses on Friday.

Preston

A spokesperson said: “We understand this remains a frustrating time for businesses who are waiting for further information on grant payments.

“Our team are working hard to process this and we hope to begin making payments for Tier 3 support grants early next week using money from our own reserves. We’re thankful for the continued patience and understanding of business owners at this time.”

South Ribble

Speaking to the LDRS last week, council leader Paul Foster said the authority was planning to use reserves to start making discretionary payments ahead of receiving the funding from the government.

“I just want local businesses and the community to get the support that they need,” Cllr Foster said.

Wyre

A spokesperson said: “We are currently working through the guidance received earlier this week. We will be updating the grant schemes on our website next week once more detailed guidance is issued by government.”