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Ombudsman expresses concern at "flawed decisions" by London borough on Covid business grants

A decision by Camden Council's to refuse Covid business grants to two businesses over incorrect ratepayer records at the local authority was wrong, an investigation from the Local Government and Social Care Ombudsman has found.

Following the investigation, Camden Council has agreed to reconsider how it will deal with businesses that missed out on Covid grants.

In one case, the council will reconsider a man's application for a small business grant (SBG) for his food business, and in the other it will pay a second man a £25,000 retail, hospitality and leisure (RHL) grant.

The Ombudsman's investigation found in both cases the grants were not paid because the council did not know about a change in ratepayer occupying their business premises on 11 March 2020. The council erroneously interpreted government guidance, which was intended to prevent fake businesses being set up to apply for the grants, to mean that the two business were ineligible.

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When the council sought to clarify the advice, it admitted there were a “few hundred” cases where it had refused grants in such circumstances.

The Ombudsman's investigation found Government guidance gave councils' discretion to pay grants where they were not notified at the time, but later learnt of a change of ratepayer taking place before 11 March 2020.

In both cases, the council did not hold the correct information about the ratepayer for the two business premises when it made its decisions on their grant applications. But the council did not consider using its discretion to pay the grants to the two businesses when the information was clarified, and wrongly told them it had no scope to pay the grants because they had not told it of the change of ratepayer before 11 March.

The Ombudsman also found the council at fault for the way it considered the two men’s complaints about the grant refusal.

Michael King, Local Government and Social Care Ombudsman, said he is concerned there may be other businesses in Camden that have received “flawed decisions” about their business grant applications, “so I am pleased the council has agreed to consider how it might deal with any other businesses that feel they have not had their applications processed properly”.

Mr King added: “I would also urge other member councils in the London Revenues Group, which may have taken a similar approach, to consider what proactive steps they should take to rectify any similar complaints they may have received.”

In light of the findings, the council has agreed to review its decision to refuse the first man a SBG. If it finds he should have received a grant it should pay him the equivalent. It will also pay him £100 for the time and trouble bringing the complaint.

The council will also pay the second man £25,000 to reflect its non-payments of a retail, hospitality and leisure grant and a further £250 for the time and trouble of making the complaint.

In this case Camden will consider its approach if it is contacted by any business in future which is concerned the council did not process its grant properly.

A Camden Council spokesperson said: “We have listened carefully to the Ombudsman’s recommendations and have taken action in response to the complaints, which relate to the very first set of grants that were issued in response to the unprecedent challenges and demand caused by Covid-19.

“We have agreed that we will review the decision given to one of the businesses and have requested they provide evidence of their eligibility. This is however yet to be provided. In the other case, the business has provided us with the required evidence and a grant has been paid to them.

“Since the start of the pandemic our teams have been working tirelessly to ensure that businesses receive the financial support that is available to them. We have issued more than £300 million in grant and rate relief to Camden businesses as we have supported them to overcome the challenges of the pandemic and to come back stronger.”

 Adam Carey

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