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Business: Coronavirus

Question for Department for Business, Energy and Industrial Strategy

UIN 718, tabled on 12 May 2021

To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the Answer of 25 March 2021 to Question 173011 on Business: Government Assistance, if he will publish the formula that was used to allocate the (a) Local Restrictions Support Grants (Open), (b) Additional Restrictions Grant (ARG) and (c) Restart Grants; and what measure of (i) population and (ii) number of businesses was used to allocate each of those grants.

Answered on

17 May 2021

All information relating to how funding allocations for business support grants is contained within guidance that has been issued to local authorities and which is available on GOV.UK. All allocations figures are also available on GOV.UK.

LRSG (Open) allocations to local authorities were based on a government estimate of the number of in-scope business premises. This drew on data provided by the Valuation Office Agency which gave the number of business hereditaments in the local rating lists in the relevant sectors by local authority. Local authorities were asked to use their own understanding of local businesses to determine eligibility. This was a discretionary scheme meaning central government did not mandate which businesses a local authority was required to support.

For the Additional Restrictions Grant (ARG) scheme, Local Authorities received an initial one-off lump sum payment amounting to £20 per head of residential population in each eligible Local Authority area when Tier 3 or widespread national restrictions in November were imposed, whichever was the earliest date. This calculation was based on ONS 2019 Mid-Year Population Estimate for the total population within a local authority. If an area agreed an enhanced package before National Lockdown, then that negotiated amount was honoured. A subsequent top-up to ARG of £500m in January 2021 was also based on the same calculation.

In March, my Rt. Hon. Friend Mr Chancellor of the Exchequer announced a further £425 million top up to ARG would be made available to those local authorities that had spent their initial two allocations. This tranche of ARG will be allocated on the basis of business population in an area, rather than residential numbers and will only be unlocked where expenditure requirements on the first two tranches are met.

The Restart Grants allocations have been made on the basis of an estimate of the number of business hereditaments in the specified sectors covered by the grant scheme. This estimate has been informed by Valuation Office Agency data on business hereditaments in the local rating lists, but local authorities are the decision makers on whether specific businesses are eligible or not. The Government paid 90% of this estimated total to Local Authorities and are committed to provide further top ups if required to cover all businesses in scope.

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