Emergency COVID-19 funding or financial relief for companies in the UK will reportedly go back to the Treasury at the end of this month if it’s not claimed, the BBC reports.
About four months after £12 billion in Coronavirus related funding was approved to help UK businesses, £1.5 billion still remains unclaimed.
The Federation of Small Businesses (FSB) cautioned that the capital was just sitting in councils’ bank accounts. The UK government confirmed that it’s currently working cooperatively with councils in order to reach out to qualified businesses.
The Local Government Association (LGA) stated that the nation’s authorities wanted more time and also more flexibility, in order to ensure SMEs are able to benefit from the capital they may receive.
Emergency grants or financial relief for companies in England was first announced on March 17, 2020.
The Small Business Grant Fund, which made payouts of £10,000, was meant to assist local businesses with their cash flow requirements during COVID-19. The Retail, Hospitality and Leisure Grant Fund, which made £25,000 in lump sum payments, was also intended to help UK companies with their cash flow needs during these unprecedented times.
Approximately £10.8 billion has been paid to around 900,000 UK based businesses, which now leaves £1.5 billion that still needs to be distributed to about 80,000 qualified companies, according to available data. This funding must go out by the end of this month.
More than one in five businesses, or over 20%, in areas like Wealden, South Lakeland and South Somerset haven’t come forward to claim their grants, the BBC confirmed.
Mike Cherry, chairman at the FSB, has called on local companies to apply for the grant funding, however, he said that the money should not be given back to the UK government if it is not claimed before the deadline.
“There are many small businesses who aren’t eligible, so the government should widen the criteria to those on the periphery.”
Councillor Ian Lewis from Wirral Council, a local authority of the Metropolitan Borough of Wirral in Merseyside, England that provides government services, remarked:
“From my discussions with business owners and shopkeepers in Wallasey, some do not realize that this is a grant, not a loan, so it doesn’t have to be repaid. Even businesses that were able to stay open are eligible. It would be tragic if businesses close or jobs are lost because they do not apply for this money – it’s literally sitting in the council’s bank waiting to be claimed.”