The Ombudsman's final decision
Summary: Mr X complained the Council refused him the Local Restrictions Support Grant causing distress. We found fault in the Council’s decision making. We recommended the Council apologise, pay Mr X for time and trouble and remake its decision.
The complaint
Mr X complains about the Council’s July 2022 decision to refuse him a business grant, causing distress.
The Ombudsman’s role and powers
We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended) We consider whether there was fault in the way an organisation made its decision. If there was no fault in the decision making, we cannot question the outcome. (Local Government Act 1974, section 34(3), as amended) If we are satisfied with an organisation’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)
How I considered this complaint
I spoke to Mr X and I reviewed documents provided by Mr X and the Council.
I gave Mr X and the Council an opportunity to comment on my draft decision. I considered their comments before making a final decision.
What I found
Local Restrictions Support Grant open (“LRSG”) On 22 October 2020 the Government introduced a grant to help businesses that it did not legal require to close but were severely impacted by COVID-19 tier 2 and tier 3 restrictions.
The Government issue guidance to councils to help them administer the grant. This was retrospective; the grant covered the period 1 August 2020 to 5 November 2020.
Councils could decide the precise eligibility criteria. However, the Government expected the funding to support hospitality, hotel, bed & breakfast and leisure businesses.
Council policy The Council was under tier 2 restrictions from 14 October 2020. It published a policy for the LRSG open to cover the period 14 October to 5 November 2020.
This said it would offer the grant to businesses in hospitality, leisure and accommodation sectors suffering from reduced demand. It said this was unlikely to include self-catering or unserviced accommodation.
To claim this grant businesses must: Register via the Council’s website, providing all details requested in full Be operating in the hospitality, leisure and accommodation sector, according to Valuation Office records Have been impacted by the Tier Two Restrictions in place between 14 October and 4 November 2020 Be registered for Business Rates and have a business rates number Have been actively trading from the premises to which the number relates prior to the Tier Two restrictions coming into force and NOT be in administration, insolvent or had a striking off notice The maximum grant available was £1650.
Additional Restrictions Grant (“ARG”) The Government introduced the ARG to support those that did not benefit from the LRSG schemes. The initial payment was £934. However, eligibility criteria and payments changed over time.
Principles of good administrative practice The Ombudsman publishes a guidance document setting out the standards we expect from bodies in jurisdiction. We issued an addendum in response to the COVID-19 pandemic; “Good Administrative Practice during the response to Covid-19”. The following points are relevant in this case.
Basic record keeping is vital during crisis working. There should always be a clear audit trail of how and why decisions were made.
The basis on which decisions are made and resources allocated, even under emergency conditions, should be open and transparent.
Decision reasons should be clear, evidence based and where necessary explained in the particular context and circumstances of that decision.
If you use new or revised policies and processes this should not lead to arbitrary decisions and actions. Ensure you have a clear framework for fair and consistent decision making and operational delivery.
What happened In May 2022 the Ombudsman investigated the Council’s decision to refuse Mr X the LRSG closed. In doing so we found fault in how it considered the LRSG open.
Relevant to this case, the Ombudsman asked the Council to: “Reconsider Mr X’s entitlement to the LRSG (open) for the relevant period from October 2020. As part of this, it should explain to Mr X what evidence it requires in order to demonstrate his business was severely impacted by restrictions and invite him to submit this. If the Council finds Mr X would have been entitled to the LRSG (open) it should pay Mr X an amount equivalent to the grant amount that would have been paid, assuming this is greater than amounts it has already paid to him as an Additional Restrictions Grant.”
The Council agreed to action this recommendation.
On 7 July the Council wrote to Mr X. In summary it said: It reviewed the evidence he provided at the LRSG closed stage.
Holiday accommodation faced restrictions but similar rules did not apply to accommodation let out to contractors.
Mr X told the Council his accommodation was self catering and he intended to let to contractors.
Mr X provided evidence of bookings. This did not show any holiday bookings.
Mr X marketed on a website for work accommodation.
There was no evidence the business had been adversely affected during restrictions.
The premises were not used for holiday accommodation and therefore not entitled to the LRSG open as per its policy.
Mr X asked to appeal as the Ombudsman had said he met the criteria for the grant.
The Council replied to say this was incorrect; the Ombudsman said it had not properly considered the matter. It now had and so would not progress the complaint further. It noted the amounts paid to him under the ARG exceeded that available under the LRSG open.
When I spoke to Mr X I asked if the Council invited him to provide further evidence before it sent its July decision. Mr X said it did not.
In comments on a draft decision the Council said: The purpose of the grant was to support holiday accommodation rather than general accommodation.
The funding was to support businesses affected by COVID-19 restrictions. These affected holiday accommodation rather than accommodation let to contractors.
It acknowledges its policy could have been more specific that self-catering and contractor accommodation businesses would not be eligible.
When Mr X applied he gave no evidence to show the business was adversely affected during COVID-19 restrictions.
The Ombudsman confirmed it had complied with the recommendations on case 21000197.
It did not see how Mr X could provide any further relevant information.
Findings
The Council’s policy says businesses within the accommodation sector are eligible. Mr X’s business is in the accommodation sector. However, the Council refused Mr X a grant because he did not offer holiday accommodation. This was not a requirement of its policy. I therefore find the Council took into account irrelevant information in reaching its decision. This is fault.
The Ombudsman asked the Council to invite Mr X to provide evidence of the impact of restrictions to his business. However, the Council did not do this. The Council then refused Mr X a grant because it was not satisfied his business was impacted by restrictions. The Council reached this decision without taking into account relevant information. This is fault.
This is the second time the Council has failed to properly consider the matter. Mr X has suffered avoidable time and trouble approaching the Ombudsman again. Mr X has also faced continued uncertainty as to whether he is due a payment. This is injustice.
I acknowledge the Council intended its policy to only apply to holiday accommodation, but this is not stated in the policy. We expect councils to follow their published policies. I also acknowledge the Council did not believe Mr X could provide any further useful evidence. However, the Council should allow Mr X the chance to provide evidence. We expect councils to make decisions based on the information available, rather than on assumptions as to what this may be.
Agreed action
To remedy the injustice above I recommend the Council carry out the following actions within one month of the date of my decision: Provide Mr X with an apology; Pay Mr X £100 for time and trouble; Explain to Mr X what evidence it requires to show whether his business was impacted by restrictions and invite him to submit this; After considering any further evidence, remake its decision on whether Mr X is entitled to the LRSG open, giving reasons for its decision with reference to its policy and the evidence provided; If the Council finds Mr X would have been entitled to the LRSG open it should pay him an amount equal to this, less any sum previously paid on the grounds he had not received this. In such circumstances it should give evidence based reasons for its calculations.
The Council should provide us with evidence it has complied with these actions.
The Council has accepted my recommendations.
Final decision
I find fault in how the Council decided on Mr X’s entitlement to a grant. The Council has accepted my recommendations and I have completed my investigation.
Investigator's decision on behalf of the Ombudsman