The Welsh Government has unveiled a new £20m capital fund to support SMEs in the retail, hospitality, retail and leisure sectors.
However, industry figures, while welcoming the fund, said the best way of supporting many hard-pressed firms in the sectors was through the Welsh Government reinstating business rate reliefs to 75% - in line with England. The Labour administration, due to what is said is budgetary constraints, is reducing the rate back to the pre-Covid level of 40% for the 2024/25 financial year.
Its new Future Proofing Fund, which will launch in May, will provide grants of between £5,000 and £10,000 to eligible businesses. It will provide funding for investment in renewable energy technology, improvements to the fabric of premises and upgrades to systems or machinery to reduce energy use. The Welsh Government said the fund could support up to 2,500 businesses. The funding is only available for 2024/25.
Read More:
Read More:
Economy Minister Vaughan Gething said: “The ongoing cost-of-living and cost-of-doing-business crises continues to present difficulties to businesses across Wales.
“These grants will help micro, small and medium sized businesses from the retail, hospitality and leisure sectors to make some significant changes in the way they run their operations so they can adapt for the future.”
The grants will be paid up to 75% of project costs or £10,000, whichever is the lesser amount. Recipient businesses will be expected to contribute the remaining 25% from other sources
Most Read
Head of the FSB in Wales, Ben Cottam said: “Small hospitality, retail and leisure businesses face a particularly challenging environment at the moment with continued high input costs and constrained spending by customers. This is reflected in our surveys with record low confidence expressed by business owners in affected sectors – particularly in hospitality. We only need to open our social media feeds to see posts from hard-pressed businesses following the painful decision to close or downsize their businesses.
“A focus on future-proofing these businesses is necessary in the medium-term to ensure resilience and we welcome support for businesses in a position to benefit from this fund. However, what matters for so many in hospitality is the ‘here-and-now.’ This is why were disappointed that despite repeated calls by FSB and from across political parties, Welsh Government made the choice in its Budget not to support these businesses with the extension of the 75% business rate relief this year in contrast to the support in England.
"The announcement of this fund does not compensate for the significant shortfall in that support for businesses struggling to get through this difficult period. We will continue to make the case for Welsh Government to re-think its position on this matter.”
Director of the Wales Fast Growth 50 project, which annually features many firms in the three sectors as amongst Wales fastest-growing indigenous firms, Professor Dylan Jones-Evans, said: “Whilst any support for Welsh businesses is to be welcomed, there are more urgent priorities for hospitality firms that have been hit hard during the recent cost of living crisis.
" Entrepreneurs operating in this sector have told me that their main priority is to be bring costs down and that the focus of Welsh Government support should have been on maintaining the previous business rate support. In addition, it is not certain that with every pound being critical to the survival of hospitality businesses whether they will have the matched funding in place even if they wanted to spend on investment on energy saving devices or improvements to their premises.”
Finance Minister Rebecca Evans said: “In tough times, we want to help businesses get their bills down for good. This new fund will help reduce running costs with practical support that aids long term business planning.
“We are also providing a fifth successive year of support for retail, leisure and hospitality businesses with their rates bills, at a cost of £78m. This builds on the almost £1bn of support provided in rates relief schemes to these sectors since 2020-21.”