Agenda item

Report HPR2020/011

The report sought approval for officers to distribute the government grant funding for businesses in line with locally defined government criteria in addition to the local eligibility criteria. Council officers had spoken to members of the business community and other London local authorities during the development of the criteria.

Central Government (through the Department for Business, Energy and Industrial Strategy) had confirmed further grant funding for businesses, to be distributed by Local Authorities at their discretion. Guidance had been provided and at the time of writing the report a further technical note to inform local decision making was expected which had been received by the time the Committee considered the report.  The amount of funding for distribution in the Borough of Bromley would be £2.4m. The Government had identified a set of business types that should benefit from the scheme, which largely recognised those that would have missed out on the previous Business Rate grant funding:

·  Small businesses in shared offices or flexible workspaces, including units in larger complexes.

·  Regular market traders with fixed property costs.

·  Bed and breakfasts that pay Council tax instead of business rates

·  Charity properties in receipt of charitable rate relief.

In addition Bromley Council would specifically include park cafes within its advertised list of eligible business types as quality green spaces was a Council priority. Park cafes normally did not pay business rates and therefore would have been excluded from the previous grant funding available.

The Committee noted that the Government had placed a cap on the level of funding available and as such the Council had to work within the financial envelop of £2.4m.

In opening the debate, with reference to the local eligibility criteria, the Vice-Chairman suggested that the criteria should refer to “salaried” internships to ensure that interns and apprentices were paid the national minimum wage or more, not simply expenses.  It was agreed that the Committee would make this recommendation to the Leader.

Members noted that in order to be eligible for the grant, businesses would have to meet at least two out of the five local eligibility criteria.  The local eligibility criteria that were proposed were to ensure that the businesses who contributed the most to the Borough would benefit from the grant finding that was available.

In response to a question concerning whether the Council would be able to reclaim administration costs from the Government, the Assistant Director for Culture and Regeneration confirmed that the guidance that had recently been received indicated that new burdens placed on local authorities would be funded however the details of this and the level of any funding was as yet unclear.  The £2.4m grant funding would go in its entirety to businesses operating in the Borough.  Members noted that Discretionary Business Grants would largely be administered by Liberata on behalf of the Council.  Bromley staff would be providing support to businesses applying for the grant.

Members noted that a number of businesses across the Borough were already aware of the grant.  In addition a great deal of work had been undertaken to identify businesses that would be eligible for the grant.  Plans were also in place to enable the availability of the grant to be promoted through the Council’s social media platforms and through press releases.  With reference to promotion of the grant, the Chairman noted that ward councillors were receiving enquiries and it was agreed that the generic email address for enquiries should be sent to Members to assist with these enquiries.

The Committee noted that as a result of the technical guidance that had now been received from Government only minor changes to the scheme using delegated authority were required.  In the future if any more significant changes were required these would only be implemented with Member approval.

Turning to the local eligibility criteria, in response to a question concerning how businesses would be able to evidence a 50% drop in turnover since March 2020, the Assistant Director for Culture and Regeneration confirmed that businesses would have to evidence this through bank statements.  The Committee noted that there had been extensive consultation with businesses across the Borough with respect to the local eligibility criteria.

The Chairman highlighted the need to ensure that there were robust anti-fraud measures in place.  The Assistant Director for Culture and Regeneration provided assurances that the Council’s Audit Team had informed the approach to the distribution of the grant.  In addition the Council would be utilising the Government’s Spotlight system to try to combat fraud and it was clear that the Council would be able to recover any funding received through fraudulent means.  The Director of Finance also highlighted that robust pre-application and post-application checks would be in place and these would mitigate some of the risk.  Members noted that that there was the possibility that businesses operating in multiple areas could make claims to multiple local authorities.  The Assistant Director for Culture and Regeneration confirmed that this issue had been raised with the Government and businesses were required to sign a declaration confirming that they had not submitted claims for discretionary businesses grants any where else.

In respect of the distribution of the grant, Members noted the importance of recognising the limited amount of grant funding that was available when compared to the number of businesses that may be eligible for the grant.  The aim was to spread the funding as fairly as possible and the size of the grants distributed would be defined by the number of applications.  As such, it was unlikely that any businesses would receive grants of £25,000.  The Committee also noted that banding would be employed for the distribution of grants with all businesses within each defined band receiving the same level of grant.

The Portfolio Holder for Resources, Commissioning and Contract Management stressed the importance of being clear about the timescales for distribution of grant funding in order to manage the expectations of local businesses.  Noting that a number of businesses were relying on the grant for short term support, the Portfolio Holder suggested that it may be helpful to employ a simplified process which enabled an immediate payment of a lower amount.  Many if not most of the businesses seeking to claim funding would be small businesses which would benefit from an initial lower amount of funding.

In summing up the debate the Chairman highlighted that the Committee would be making the following three  additional recommendations to the Leader

1.  Investigate whether a simplified process can be put in place to enable initial interim payment of grants of up to £2k to be distributed to businesses, prior to the final grant amount being determined.

2.  That the local eligibility criteria be amended to clarify that they apply to salaried internships..

3.  To ensure there is due diligence and anti-fraud measures built into the processes and that these be presented to the Leader prior to a decision being taken.

The recommendations to the Leader and the three additional recommendations were unanimously agreed by the Committee.

RESOLVED: That the Leader be recommended to

1.  Approve the recommendations for the distribution of this grant fund set out in the commentary of this report, namely: the recommended local parameters in relation to the national guidance set out in paragraphs 3.6 and 3.7; and the local eligibility criteria set out in paragraph 3.9.

2.  Agree that the Director of Housing, Planning, Property and Regeneration has delegated authority to: make changes to the grant distribution approach if required once the Government’s technical note is issued; and to exercise limited discretion during the award process. This delegated authority will include consultation with the Portfolio Holder for Renewal, Recreation and Housing.

3. Investigate whether a simplified process can be put in place to enable initial interim payment of grants of up to £2k to be distributed to businesses, prior to the final grant amount being determined.

4. Agree that the local eligibility criteria be amended to clarify that they apply to salaried internships.

5. Ensure there is due diligence and anti-fraud measures built into the application and distribution processes.