The eligibility criteria for the Welsh Government’s additional financial support for businesses and charities arrived last Friday without much noise. It is intended to address the gaps left by the schemes already announced by the UK Government, Welsh Government and Development Bank of Wales.
I am certainly not criticising the volume or speed of the response to Covid-19 from both governments but does this latest initiative paper over all of the cracks?
The Economic Resilience Fund is broken down as follows:
- £100m COVID-19 Wales Business Loan Scheme administered by Development Bank of Wales (which is fully subscribed)
- £100m fund to support microbusinesses
- £300m fund to support SMEs and large businesses
Support for Microbusinesses :
A grant of up to £10,000 is available to assist microbusinesses that have been affected by the COVID-19 outbreak.
- This grant can only be claimed by businesses that meet the following criteria:
- employing between 1 and 9 employees (In addition to the business owner)
- operating address in Wales and have employees in Wales
- VAT registered
- have experienced a drop in turnover greater than >40% as a result of the COVID-19 outbreak (since the 1 March 2020)
- supported businesses must aim to maintain employment for 12 months
- only one application per businesses
Businesses will need to provide:
- details of reduction in turnover as a result of the COVID-19 outbreak
- evidence of business address by providing VAT registration
The grant is available to microbusinesses that are not eligible for the Business Rate Grant or the support for self-employed grant.
The Economic Resilience Fund for microbusinesses is open to applications from 17 April 2020 for 12 months.
Support for SMEs and larger businesses:
To qualify businesses, need to meet the following criteria:
Applications will be available from 17th April.
- Confirmation is provided that funding from any other Welsh Government non-repayable grant funding source is not being pursued;
- In excess of a 60% reduction in turnover since 1 March 2020 has been experienced;
- Not eligible for business rate relief grant, or if it is, the amount would be deducted from the allocation from this fund;
- Operating address in Wales and has employees in Wales;
- A sustainable business plan exists to trade beyond the COVID-19 pandemic;
- Inability to access funding needed from a bank (including the British Business Bank) is demonstrated; and
- Confirm no future compulsory redundancies will be made as long as the Coronavirus Job Retention Scheme is in place.
- Applicant businesses and organisation will be expected to align with the ethos and principles of the Economic Contract, click here to view.
- In submitting an application for the Resilience Fund, I am content for my application details to be shared following GDPR approval with delivery partners of the scheme (Local Authorities and Business Wales)
- If successful I am happy for the name of my business to be published on a recipients of support list on the Welsh Governments web site.
Neither scheme is as easy to access as the small business rates grants and the self-employed grant. Proof is required of loss of business, there must be at least one employee in addition to the owner and the business must be vat registered.
Again, the owner managed companies have been ignored. There are many small limited companies whose only employees are the shareholder/directors. These are now automatically excluded from applying for assistance from this fund.
A limited company that has traded for a long time, operates from one of the 2 owner directors’ homes, has paid corporation tax every year and has provided them with an income for all of that period can only claim for: –
- job retention scheme – £133 per week
They are not entitled to: –
- small business rates relief.
- Self-employment Income Support Scheme.
- Submit an application to the Economic Resilience Fund.
Mr Sunak stated this week that we cannot save everybody and there will be job losses. He should look harder at the genuine taxpayers that are being ignored.
Job Retention Scheme portal opens 20th April. If you require our assistance to process applications, please contact firstname.lastname@example.org
Development Bank of Wales:
For details of the financial support available from the Development Bank of Wales please visit their website.
The £100 million loan scheme was fully subscribed in the first week.
Contact us for more information and please feel free to pass this information onto those who may find it useful.