One in five small businesses have had no emergency Covid-19 help

About 1m small businesses and sole traders completely left in the cold without any Government grants, says Federation of Small Businesses

One in five small businesses have not had any emergency Covid-19 help during the pandemic.

That is around 1m of Britain’s 5.9m small businesses and sole traders left without financial support, mainly because they are not in retail, leisure or hospitality, according to the Federation of Small Businesses.

Retail, leisure and hospitality have been given a holiday from business rates, along with qualifying for ongoing grants totting up to tens of thousands of pounds.

>See also: Half a million businesses at risk of collapse without more support

But companies that do not fit neatly into definitions of such sectors, including suppliers, are entitled only to about 10 per cent of grants, the federation told the Times.

The FSB surveyed more than a thousand small business owners and found that one in five (22 per cent) reported having had no financial help from the Government since pandemic began.

A separate federation study suggested that one in two small businesses (51 per cent) had not been able to get hold of a cash grant, and a derisory one in twenty (5 per cent) had received any discretionary grants from their local authority, such as those offered for businesses outside of retail, leisure and hospitality.

Nearly 90 per cent of an extra £1.6bn in emergency Additional Restrictions Grant funds promised back in October have yet to be paid out, according to the Events Industry Association’s own research.

>See also: Local Authority Discretionary Grants Fund – how it can help your business

In turn, local authorities have blamed the Government for the slow payment of Covid-19 grants during lockdown, with businesses still waiting for cash.

Although the Government says it has paid out the £4.6bn worth of Covid-19 grants to be distributed by all 314 local authorities over the current national lockdown, it still has to release of the £12bn worth of support first offered last year, say local authorities.

The Local Government Association said that councils had been struggling to distribute the money, due to increased state-aid compliance issues and vetting applicants for fraud. They have focused on getting larger amounts for January’s business closures out the door, as opposed to last year’s smaller grants.

Mike Cherry, chairman of the FSB, said: “Small firms which sell to other businesses outnumber those which sell to consumers three to one – thousands don’t have a commercial premises or neatly fit the definitions of retail, leisure and hospitality. Too many have been left out of support measures as a result.”

Further reading on emergency Covid-19 help

150 UK small business grants to apply for right now – UPDATED