Virus grants are postcode lottery for small firms with some councils paying just one in ten eligible companies
Desperate firms scrambling for emergency grants to survive the pandemic face a ‘postcode lottery’, with some councils paying as few as one in ten companies eligible for the lifeline.
Latest figures show councils have handed out £6.1billion, almost half the £12.3billion they received from Government this month.
Grants of up to £25,000 have been received by 491,725 small businesses, including shops, pubs, restaurants and cafes. Under the small business grants fund, firms qualify for cash payments of £10,000.
Emergency grants: Latest figures show councils have handed out £6.1bn, almost half the £12.3bn they received from Government this month
Under the retail, hospitality and leisure business grants fund, small companies can get up to £25,000.
But some town halls have been far quicker than others at paying companies. Birmingham City Council has handed grants to just 2,041 of the 19,146 firms owed the money – or just over one in ten of the eligible companies.
Of the £231.6million it received from central government on April 1, just £36.7million has landed in local companies’ bank accounts.
Tunbridge Wells council in Kent, South Oxfordshire council, and the local authorities in Slough and Luton have paid roughly one in ten firms earmarked for grants.
In stark contrast, Winchester council has paid all 1,443 eligible firms, while Redcar & Cleveland has paid 2,328 – or 98 per cent – of 2,376 grants owed.
Many councils have paid well over half of firms entitled to the money.
But 473,354 firms across the country are still owed £6.2billion, compounding fears that huge numbers could collapse.
Councils say they are short-staffed and that it has been difficult to obtain the necessary information from firms. But business groups have hit out at delays.
Ian Cass, at the Forum of Private Business, said: ‘For the Government to rely on these authorities to distribute grants and expect consistent delivery was always wishful thinking.
What they have done is created a postcode lottery for small and micro businesses, where geography decides if you have received the much needed funds or if you are still waiting.’
Mike Cherry, at the Federation of Small Businesses, said: ‘[Councils] must act now if they want to see small businesses survive on their local high streets when we reach the other side of this crisis.’
Councillor Richard Watts, of the Local Government Association’s resources board, said: ‘Councils have worked hard to distribute more than £6billion to small businesses.
Many have set up teams and redeployed staff to run the scheme and ensure the risk of fraud is minimised.
It has been a big task but councils will continue to work at pace to ensure eligible businesses receive this vital funding as quickly as possible.’
Yesterday, Birmingham council said: ‘The council is processing millions of pounds of grants.
‘Our teams are working around the clock, including weekends, to make sure submissions are checked and details are correct before we process payments.
‘A further £35million of grants will be processed today with significant numbers to follow tomorrow [Thursday] and Friday.’