- 5 Mar 2021
Overview: Small Accommodation Providers paying Council Tax Fund
The Small Accommodation Providers paying Council Tax Fund (SAP-CTF) Fund is designed to support eligible B&Bs, guest houses and self-catering accommodation that have experienced financial hardship as a result of coronavirus protection measures.
It covers businesses which do not pay non-domestic rates but pay council tax, and is part of wider support for the tourism and hospitality sector.
Eligible businesses will receive a grant of £2,000 every 4 weeks. Payments will be backdated to the start of January 2021 and cover until the 31st March 2021, the period of which Level 4 restrictions have applied from 26th Dec 2020. This grant is not retrospectively backdated to 2nd November 2020.
The fund will be delivered in three waves. In all waves the business should have been trading on 2nd November 2020.
These fund will be delivered by local councils on our behalf.
For the first and second waves, local councils are to identify and invite relevant businesses to apply. The third phase will be done via applications.
The first wave will support Council Tax B&B and guest house businesses that were funded through the 2020 B&B Hardship Fund. This scheme supported a total of 404 businesses, who are automatically considered to be in scope now. Local councils are expected to contact these eligible businesses and invite them to reconfirm their details and register for payment
The second wave will provide support to self-catering, B&Bs and guest houses that were supported through the 2020 Culture, Tourism, Hospitality Enterprise Hardship (CTHHF) Grant. As with the first wave, these businesses are automatically considered to be in scope now. We will provide a list of eligible businesses to local councils who should contact them and invite them to reconfirm their details/register for payment.
The third wave will be for new entrants to the fund, for example:
- eligible businesses that may have missed out on funding under either the B&B Hardship Fund or the CTHHF
- businesses that may not have previously sought support who meet the criteria
We will work with local councils to create an application process for these. A further grant offer letter, covering wave three will be provided shortly.
Role of local councils
Local councils will administer the grants on our behalf, and will be responsible for delivering the funding to eligible businesses. We will provide information on funding levels and periods.
Payments will be made where possible into the business bank account of the business, and personal accounts where a business bank account is not held by the business.
Local councils are expected to offer an appeals process for applicants for the third wave.
Given the complexity and pace surrounding delivery of this scheme, elements of this guidance are subject to change.
Due diligence, monitoring and reporting requirements
Given their responsibilities for managing public funds, it is up to local councils to ensure that procedures for administering the grants are suitably robust, including due diligence to mitigate fraud and for audit purposes.
Local councils are required to be assured of the validity of any supporting information requested in determining eligibility for a grant. We will require local councils to regularly supply agreed management information by sector and rateable value, including:
- the number of eligible businesses
- awards made and any refused (with rationale)
- the number of and amounts of actual payments made
The Grantee will maintain a log of monies paid under this scheme and provide Scottish Government officials with weekly updates, until the scheme closes (or date agreed with officials).
Local councils are expected to offer an appeals process for applicants.
State Aid and subsidy control
State Aid is a European Commission consideration of public assistance given to undertakings on a discretionary basis and having the potential to distort competition and affect trade between Member States of the European Union. An undertaking is defined as any entity, regardless of its legal status, which is engaged in economic (commercial/competitive) activity relating to a market in comparable goods or services. A grant reduces an undertaking’s current expenditure, and so can be regarded as State Aid.
On 19 March 2020, the European Commission announced a temporary framework to enable Member States to further support the economy in the COVID-19 outbreak.
This temporary framework allows aid to be granted to undertakings facing difficulty as a result of the COVID-19 outbreak, and extends the limit of support to €800,000 in the form of grants, repayable advances and tax or payments advantages.
The UK Government submitted a UK-wide umbrella scheme Covid-19 Temporary Framework for UK Authorities’ which was approved under the Temporary Framework allowing UK public authorities to grant aid as quickly and as flexibly as possible. For more detail, see: Coronavirus (COVID-19): state aid - guidance for public authorities.
Local authorities should ensure that the applicable conditions are met, including obtaining the information required for transparency reporting purposes.
Support under this framework should only offered to properties that can demonstrate they were not in financial difficulty on 31 December 2019. Councils must therefore ensure they hold this information from grants applicants. See paragraph 18 of regulation (EU) No 651/2014 of 17 June 2014 for the definition of a 'firm in difficulty'.
The Temporary Framework covers aid granted until 31 December 2020. Local authorities should continue to have regard to these requirements until otherwise advised.
From 1 January 2021
Strategic Framework Business Fund awards issued up to 31st December 2020 were subject to EU State aid regulations. As of 1 January 2021 any grants considered to be a subsidy will need to be compliant with the Trade and Cooperation Agreement (TCA). A further update will be provided separately.
Following the end of the transition period on 31 December 2020, a new Subsidy Control regime came into effect in the UK at 11pm on 31 December. It is anticipated that awards will be made under similar terms to COVID-19 schemes in operation before the 1 January 2021 and additional information will be provided to successful applicants in the award letter and terms and conditions but our interim position is that the terms of the Covid-19 Temporary Framework for UK Authorities should continue to be applied. Use of the Temporary Framework should mitigate the risk of challenge under the Temporary Framework, as well as being an established and flexible mechanism for delivering COVID-19 related support.