Colliers: £1.7 billion still to be distributed from Government Small Business Grant System – nearly 10% of this in the North West

– The Government Should Consider Re-diverting funds to help those businesses that have “fallen between the cracks” as a result of Covid-19 says Colliers –

July 13th 2020 – Business rates experts at Colliers International are urging the Government to revisit its grant scheme for businesses- set up to help with the financial impact of the Covid-19 pandemic- and to consider re-deploying some of the funds to help those businesses and the three million workers so far “excluded” from receiving any Government financial help.

According latest Government figures, of the £12.33 billion originally allocated to Local Authorities to pay to businesses via the Small Business Grants Fund (SBGF) and Retail, Hospitality and Leisure Grants Fund (RHLGF) some £10.65 billion or just over 86 per cent has been paid out, leaving £1.7 billion or 14 per cent still undistributed to businesses.

In the North West region alone, there are £160.5 million of outstanding grant payments still to be distributed which is nearly 10% of the region’s initial allocation of just over £1.64 billion, despite the fund being set up 15 weeks ago on March 23rd. Several local authorities have still not distributed millions of pounds.

Looking at individual councils

• Liverpool City Council has paid out £94.5 million (88%) of its £107.8million allocation.
• Cheshire East has allocated £82 million (86%) of its £95.5 million allocation
• Manchester City Council has paid out £96.4 million (79.7%) of its £121 million allocation
• Wigan Council has paid out £59.5 million (74%) of its £80.9 million allocation.
• Blackpool has paid out £43.6 million (74%) of its £59.1 million allocation

John Webber, Head of Business Rates at Colliers International, said, “I find it incredible that £1.7 billion of the Government’s grant scheme has still not been distributed to businesses despite the scheme being set up four and a half months ago. And this seems to be the pattern across the country. The North West region is not an exception . Manchester City Council alone, for example still has £24. 6 million of allocated funds still not distributed all this time later.

“One could conclude that this is because either certain Local Authorities have been too short staffed or inefficient in handing out much needed grants – or- and what is probably more likely, State Aid rules are stopping some businesses who have multiple properties from accessing all the grants. This might particularly apply to multiple store retailers. If this is the case, then there will still be some funds going begging.”

Webber continued, “We have a bizarre scenario where on one hand we have 3 million workers and businesses “excluded” from receiving Government help in terms of grants, or the discretionary fund, many of which may soon be pulling the plug on their companies.

And on the other hand, we have £1.7 billion of English grant money sitting there and not claimed after four and a half months. Perhaps it would be sensible to conclude that if after 15 weeks; a number of businesses still have not claimed funds, it probably means the grant allocated is very unlikely to be used.

“The Government might consider clawing back any grant monies not distributed by certain local authorities to use in those areas where businesses do need greater support.

“The current set up is just not working.  There are hundreds of businesses that need grant help which are still being denied it – particularly in our English cities. Small businesses are the lifeblood of the economy and we urge the Government to look again at the way it is provides support to those “excluded”- or “forgotten”. Properly utilising £1.7 billion that nobody seems to be claiming would certainly seem to be a good start.”