Publication - Advice and guidance

Coronavirus (COVID-19) local restrictions grants: local council and enterprise agency guidance

Published: 14 May 2021
Last updated: 29 Jul 2021 - see all updates

Information for local councils and enterprise agencies on financial support for specific businesses impacted by the decision to retain restriction levels.

Coronavirus (COVID-19) local restrictions grants: local council and enterprise agency guidance
Route Map Extension Restrictions Fund

Route Map Extension Restrictions Fund

This information is provided by the Scottish Government, in conjunction with the Convention of Scottish Local Authorities (COSLA), to Scottish local authorities. 

On 22 June 2021 the Scottish Government announced that local authorities will be kept at their current Protection Levels (PL) for an additional three-week period with effect from 28 June, with the next review on 13 July 2021. Additional financial support will be offered for eligible businesses that are subject to ongoing restrictions at Protection Levels 1 and 2 as a result of the extension of the Routemap and that were previously in receipt of support through the Strategic Framework Business Fund.

This grant funding will be made available through powers conferred by Sections 126 and 127 of the Housing Grants, Construction and Regeneration Act 1996.

This document has no statutory basis, is offered without prejudice to relevant legislation and legal decisions, and does not constitute legal advice. 

The document aims to inform a mutual understanding amongst local authority practitioners engaged in the administration of these grants. It includes specific information relating to the grants.

Given their responsibilities for managing public funds, it is for local authorities to ensure that procedures for administering the grants are suitably robust, including due diligence to mitigate fraud and for audit purposes.

Local authorities are expected to seek recovery of overpayments including pressing criminal charges where necessary, if fraudulent claims are found. Councils will not be held financially liable for overpayments associated with fraud and error. The exception to this would be circumstances where a council is found to be materially not compliant with the relevant UK Government fraud control guidance.

How the grants will be provided

Local authorities will administer the grants and will be responsible for delivering the funding to eligible businesses.

The Scottish Government will fund Councils to make these payments, and will make additional funding available to support businesses corresponding to the length of time that it is necessary to retain Protection Levels 1 or 2 restrictions within the relevant local authority areas.

Local authorities should align this additional grant process with the existing retained infrastructure for the Strategic Framework Business Fund, including where possible for businesses with multiple eligible premises within Protection Levels 1 or 2 areas.  Protection Levels 1 or 2 restrictions referred to in paragraph 2 above apply from 28 June 2021.  Local authorities are asked to process the first payments to businesses by 2 July 2021(and weekly thereafter, as appropriate). 

Eligibility for support through this fund is predicated on whether a business has previously been in receipt of financial support through the Strategic Framework Business Fund.  As such the council is not therefore required to set up a separate application process for this fund. A local authority may, however, apply discretion in awarding a grant to a business that did not previously access the Strategic Framework Business Fund despite otherwise meeting the eligibility criteria and is impacted by restrictions in place at Protection Levels 1 or 2.

Our preference is for payments to be made into business bank accounts although payments into personal bank accounts are permissible where local authorities are able to verify that the account is used for business purposes. 

Due diligence, monitoring and reporting requirements

The Scottish Government will require local authorities to supply agreed management information on, by sector and RV class: the number of eligible businesses; awards made and the number of and amounts of actual payments made. 

The first management information, including number of businesses supported and value of awards made will be requested for 23 July 2021, with regular information requested thereafter.   A final reconciliation return will be commissioned for delivery at a later date.

Grant rates

Please see below for Weekly Financial Support for Businesses.

Eligibility for Businesses in Local Authority Areas in Protection Level 0

Specified nightclub businesses (including S.E.Vs) that the Regulations require to modify its operations as a result of being in Protection Level 1 are eligible for:

  • a grant of £750 each week for properties with Rateable Value of £51,001 or over; or
  • a grant of £500 each week for properties with Rateable Value up to £51,000.

Eligibility for Businesses in Local Authority Areas in Protection Level 1

Specified hospitality businesses that the Regulations require to modify its operations as a result of being in Protection Level 1 are eligible for:

  • a grant of £525 each week for properties with Rateable Value of £51,001 or over; or
  • a grant of £350 each week for properties with Rateable Value up to £51,000.

Specified casino businesses that the Regulations require to modify its operations as a result of being in Protection Level 1 are eligible for:

  • a grant of £525 each week for properties with Rateable Value of £51,001 or over; or
  • a grant of £350 each week for properties with Rateable Value up to £51,000.

Specified nightclub businesses (including S.E.Vs) that the Regulations require to modify its operations as a result of being in Protection Level 1 are eligible for:

  • a grant of £750 each week for properties with Rateable Value of £51,001 or over; or
  • a grant of £500 each week for properties with Rateable Value up to £51,000.

Eligibility for Businesses in Local Authority Areas in Protection Level 2

Businesses in the Soft Play (Soft Play businesses must have separate 'pay to play' charges (for clarity, this grant is not available to businesses that have a courtesy soft play area for customers i.e. car showroom, restaurant, airport, dentists waiting area, or is free to use as part of a larger entity etc).  If a 'pay to play' soft play is within a multiple use unit, and use is not separately defined in the valuation roll, the 'pay to play' soft play's Rateable Value will be determined on the percentage of floor space it occupies including a pro-rata percentage of any attached café/retail area.) sector that the Regulations require to remain closed at Protection Level 2 but were permitted to open in other parts of Scotland from 5 June 2021 are eligible for:

  • a grant of £750 each week for properties with Rateable Value of £51,001 or over; or
  • a grant of £500 each week for properties with Rateable Value up to £51,000.

Specified hospitality businesses that the Regulations require to modify its operations as a result of being in Protection Level 2 are eligible for:

  • a grant of £525 each week for properties with Rateable Value of £51,001 or over; or
  • a grant of £350 each week for properties with Rateable Value up to £51,000.

Specified casino businesses that the Regulations require to modify its operations as a result of being in Protection Level 2 are eligible for:

  • a grant of £525 each week for properties with Rateable Value of £51,001 or over; or
  • a grant of £350 each week for properties with Rateable Value up to £51,000.

Specified nightclub businesses (including S.E.Vs) that the Regulations require to modify its operations as a result of being in Protection Level 2 are eligible for:

  • a grant of £750 each week for properties with Rateable Value of £51,001 or over; or
  • a grant of £500 each week for properties with Rateable Value up to £51,000.

To be eligible for financial support through this fund a business must be operating in a local authority area where there are PL1 and PL2 restrictions beyond the 28 June 2021 and which are required to close or specifically required to modify their operations as a result of the restrictions in place.

Hospitality premises include restaurants, including restaurants and dining rooms in hotels or members’ clubs; cafes; bars, including bars in hotels or members’ clubs; and public houses.  They do not include accommodation premises where these features are not present.  Members’ clubs may include social or sports clubs with a liquor licence.  Wet pubs and those that serve food are both included. 

Only businesses that have previously received financial support through the Strategic Framework Business Fund are eligible for a grant through this scheme. 

This support applies to restriction levels which apply with effect from 28 June 2021, grants will not be backdated prior to this period.

Where a premises has mixed use it is eligible for a single grant based on the main business activity for the premises. 

Retail businesses as well as accommodation providers that are not impacted by hospitality regulations are not eligible for support through this fund.

Additional eligibility criteria

In addition to levels of grant award, this guidance also sets out the criteria which the Scottish Government considers appropriate for the purpose of determining eligibility for these grants. It should be read and applied in conjunction with the guidance letters of 9 November 2020 and 27 January 2021 on the Strategic Framework Business Fund. In the main, criteria for eligible sectors must replicate the updated eligibility criteria already in use for businesses in areas subject to Protection Level 2 restrictions, and as set out above.  

It is for a local authority to determine if a business meets the description and further information can be requested, where necessary, to determine eligibility. 

Subsidy control considerations

Applicants are required to declare all previous support received from UK or Scottish or local government support schemes to provide local authorities with the necessary information to ensure payments are made correctly and compliant with EC State Aid and subsidy control limits.

The EU State Aid rules no longer apply to subsidies granted in the UK following the end of the transition period, which ended on 31 December 2020. This does not impact the limited circumstances in which State Aid rules still apply under the Withdrawal Agreement, specifically Article 10 of the Northern Ireland Protocol. The United Kingdom remains bound by its international commitments, including subsidy obligations set out in the Trade and Cooperation Agreement (TCA) with the EU. Read more at: BEIS Guidance for public authorities explaining the subsidies chapter of the TCA, World Trade Organisation rules on subsidies, and other international commitments.

The Council will need to ensure that any funding awarded after 31 December 2020 is compliant with the UK’s international commitments arising from membership of the World Trade Organisation or through the UK’s various Free Trade Agreements, including the UK-EU Trade and Cooperation Agreement. Further guidance on the application of these agreements is provided by the Department of Business, Enterprise, Innovation and Skills.

 


First published: 14 May 2021 Last updated: 29 Jul 2021 -