Whilst I welcome the Government’s emergency financial package to support businesses during the Coronavirus epidemic, I am concerned to ensure that every legitimate business gets this targeted help.
The Small Business Grant Fund (‘SMBF’) provides £10,000 to all eligible businesses in the businesses rate system. This is being missed by many who rent their space, and then pay their business rates as part of their rent. Landlords may not be eligible for the £10,000 award to pass down to their occupier. I have contacted the Treasury to press for a solution on behalf of this type of business. An official maintained that this would be too complicated for our local authorities to handle. Through my weekly calls with both Rother and Wealden District Councils, I was able to establish that this should, for many cases, not be too difficult. For those requiring an inspection from the Valuation Audit Office, it could be. For others, it would not.
As an alternative, and working with our two District Councils, I put an idea to the Treasury that a separate scheme should be set up to help those who pay Business Rates through their rent. This would take the form of a payment, up to a maximum of £10,000, to offset the payment of rent. Proof, in the form of tenant statements and business receipts, would demonstrate the business was valid and had fallen through the cracks of the original policy (which was designed to help all small businesses).
This policy idea is now being considered by Ministers at the Treasury and the Department of Housing, Communities and Local Government. For those concerned about the added total cost for this additional layer, it should be noted that the total sum given by Central Government to Local Government for these £10,000 payments is likely to be greater than those who apply and are eligible. With the surplus, it would be good to give our local authorities more discretion in order to help those who should be eligible but are not due to a technicality. I know that Rother and Wealden District Councils would like to be able to do more. Both councils were in the first phase to start paying out these vital grants.
There are others who have been left behind from other assistance, perhaps because they had set up their business recently or because they are slightly over the income ceiling. I have lobbied for these to be given a tapered, rather than cliff-edge, approach. It is welcome, for additional lending finance, that the Government is now offering 100% guarantees for loan repayments for smaller businesses. The transfer of credit risk from borrower to Government should ensure that finance is made available faster. It is vital that businesses must demonstrate they were in good financial health prior to the lock-down announcement.
There are many technicalities involved but, as an MP to a constituency where small businesses make up the bulk of our local economy, I will continue to do my best to deliver help to all those legitimate and once-thriving businesses.