North East councils have handed back more than £50m in coronavirus grants designed to support local businesses.
In total local councils across the 海角视频 have returned more than £1.2bn in funding from the Government’s first three coronavirus support funds after many businesses did not qualify for the grants.
More than £588m was allocated to North East councils through three coronavirus grants. But official figures analysed by BusinessLive found that £50.2m of the funding is being sent back to the Treasury. The figure represents 8.5% of the North East’s allocated funding.
The figures cover the Government’s first three coronavirus funding packages: the Small Business Grant Fund (SBGF), Retail, Hospitality and Leisure Grant Fund, and the Local Authority Discretionary Grants Fund. The grants were open for a number of months but came to a close in August.
The money is being returned after councils discovered that despite receiving huge sums of money to support local businesses, many companies did not qualify for the grants.
A Government spokesman said that the payments were made to local authorities in advance to make sure funding could reach businesses as quickly as possible. However, the figure meant that the many councils were allocated too much money based on “an overestimate of the number of eligible businesses”.
The spokesperson added: “We’re working with local authorities to arrange for the return of any unspent funds from our business grant schemes. Any cash returned helps fund ongoing support for people’s jobs and incomes through the pandemic.”
As the largest council in the region, Durham County Council received the largest allocation of funding in the North East at £112.2m. Of this it returned £7.3m to the Treasury.
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However, Sunderland City Council and North Tyneside Council both returned the largest proportion of their funding to the Government, with both councils handing back 14% of their funds.
Both authorities said they followed Government guidelines to determine which businesses where eligible for the funding.
A spokesperson for Sunderland City Council said: “Government estimates determined the amounts of funding allocated to local authorities. “The city council administered the schemes and funding has been granted whenever businesses applied and met the Government’s criteria.
“The council also received £2.4m in funding for a discretionary Sunderland grant scheme and this has all been distributed. Businesses networks joined the council in promoting the schemes and opportunities for support.
“This council continues to support and work with businesses wherever possible and returning unallocated funding from Government estimates is categorically not a council ‘fail’.”
John Sparkes, North Tyneside Council’s head of regeneration and economic development, said: “As a council we’ve worked really hard throughout the pandemic to put measures in place to support businesses through the recovery period.
“We’ve paid out £34m of Government grants to more than 3,000 businesses, set up a free helpline through our Business Factory, created a webpage via the North Tyneside Business Factory to act as a ‘one-stop shop’ for anyone needing information and advice, engaged directly with hundreds of business owners, helped promote the ‘Buy Local North Tyneside’ campaign and reintroduced free parking at weekends in town centres throughout December.
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“Every business that applied for financial support and was eligible under government grant rules received a grant. We know some businesses, such as home workers, were unable to claim the same grants as those with business premises. We continue to engage with Government over greater support for all the brilliant businesses in our borough to supplement the support the council offers.”
You can see how much money local authorities around the country handed back to the Treasury here.