Businesses have taken a pounding during the COVID-19 pandemic. The abrupt lockdown meant that, for many of them, income and cashflow dried up overnight.
The Government has done its best to help, with a series of interventions. Among them is a grant of £10,000 for retail, leisure and hospitality business entitled to Small Business Rates Relief (SBRR).
In Wales, the grant is administered by local authorities, under the direction of the Welsh Government (WG). A local issue arose, in that it appeared that some owners of weekend cottages had registered their properties for SBRR. Everyone agreed that people shouldn’t receive a grant for a weekend bolthole, and the WG decided to do something about it.
The WG therefore issued guidance to local authorities that, before making a grant, they should insist on:
· production of two years’ business accounts;
· proof that the property had been let for at least 140 days in the last year; and
· evidence that rent from the lettings comprised the principal income of the applicant.
The guidelines were certainly successful in precluding weekenders from obtaining a grant. Unfortunately, they prevented many genuine small businesspeople obtaining one, too. Some were unable to show two years’ accounts, for the simple reason that the had bought their property within the last two years. Some had been trying to let the property for the whole season, but had failed to so do for more than 140 days. And for some, income from the property was less than 50 per cent of their total income.
Nevertheless, all were running genuine small businesses and, in all likelihood, would receive little or no income in the current year. Some had mortgages to pay. Many were worried sick.
The WG guidelines, in short, are a classic case of throwing the baby out with the bathwater. They need to be revised, and quickly. Otherwise, the operators of a lot of small businesses that comprise a big part of North Wales’s tourism offering may find that that have to sell up. Some of them may even go bust. And that surely can’t be what the WG intended.