Earlier this month, the Government revealed it was creating a 'top-up' fund that it said would help B&B owners and market traders previously not eligible to receive grants from twin £12bn schemes to help businesses affected by the coronavirus lockdown.
An estimated 10,000 bed and breakfasts - including many in Yorkshire - were among those who had missed out on previous schemes offering £10,000 grants to struggling firms due to paying council tax rather than business rates.
But the Department of Business, Energy & Industrial Strategy (BEIS) has now confirmed the new grant scheme - which is being distributed by local councils and involves payments of up to £25,000 - will not be open to any business eligible for any kind of other Government support.
This includes the Self-Employed Income Support Scheme which allows businesses to claim 80 per cent of their trading profits for three months. The Government's own estimate is that SEISS covers 95 per cent of people who receive most of their income from self-employment.
Fiona Gardham, who runs the Eighteen97 bed and breakfast in Goathland with husband Tim, is among those who will miss out. She has previously said the unfairness is added to because those businesses who could already claim from the previous grant schemes can also receive the self-employed income support scheme money.
She said today the grant was a "hollow PR exercise", with the eligibility rules particularly hard to take given second home owners who have registered their property as a commercial premise without needing to let it out have been able to claim £10,000 each from other grant schemes.
"I'm not surprised that it has gone the way it has. But the two things that have been hard to take is they have wasted so much money on the second homes side of things and they then made a big point of saying this top-up grant would help council tax-paying bed and breakfasts," she said.
"There are lots of people that are massively disappointed by it but we will get through this one way or another."
When the top-up grant scheme was announced on May 2, a Government press release specifically cited bed and breakfasts which pay council tax as one of the sectors that should be a priority for councils to provide the funding to. It followed almost 8,000 people signing an online petition calling for such B&Bs to receive grants in the same way counterparts which paid business rates had been able to.
But on May 4, BEIS confirmed to The Yorkshire Post that any business eligible for other grants or the Self-Employed Income Support Scheme wouldn't be able to receive any of the top-up grant funding - ruling out many of the B&Bs that were supposed to be priorities.Hopes were raised again for some B&Bs when the formal guidance for the new grant scheme was published earlier this week. It stated the new funding was for firms not eligible for other support - but then added ineligibility related to people who have already received cash from other schemes.
This led some to believe they may be able to choose between this grant scheme and other support.
But a BEIS spokesman told The Yorkshire Post the rules do exclude any eligible for other support schemes and no 'either/or' choice on what to receive would be available.
David Weston, chairman of the B&B Association, said his members felt let down - with many now fearing for their future. But he urged local councils to show whatever discretion they can to support the sector.
“B&Bs who pay Council Tax (51 per cent of our members), but who’ve invested in their business so not made huge profits, have been let down by the Business Department, who say if they are 'eligible' for the Government’s self-employed support (SEISS), they won’t get any help from the new £617m Local Authority Discretionary Grants Fund (LADGF).
“These B&Bs haven’t yet had a single penny of Government help, even though they’ve been closed by Government order since March 23. 37 per cent of them tell us they are ‘eligible’ for SEISS but the amount they would get ‘would not be enough to keep my business in existence’.
“Even if the SEISS scheme might only pay them a few hundred pounds when they have lost tens of thousands in turnover, BEIS say they shouldn’t get a penny of the £617m the Government announced on May 2 and prioritised for 'B&Bs paying Council Tax'.
“The official guidance on LADGF put out by BEIS to councils on May 13 had contradictory wording on the issue of eligibility, so we appeal to every local authority to use the 'discretion' given to them by BEIS to interpret that guidance in a humane and sensible way, and prioritise Council Tax paying B&Bs who urgently need the grant money to survive.
“Without some flexibility, humanity and common sense by local authorities (despite BEIS), hundreds of hard-working small B&Bs may not be able to survive and reopen in the summer."
By April 27, the Government had paid out over £7.5 billion has been paid out to over 614,000 business properties via the Small Business Grants Fund and the Retail, Hospitality and Leisure Grants Fund schemes.
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