Liberal Democrats on Cornwall Council have condemned the Tory Government’s decision to withdraw funding earmarked for Cornish businesses.
The Secretary of State for Business, Alok Sharma, today announced (24th July) that Covid-19 related Government business grants will close on 28th August. Funding already secured by Cornwall that has been set aside to support businesses who had fallen between the cracks of Government support will be returned to Westminster.
The announcement comes after the Liberal Democrats on Cornwall Council called on the Secretary of State for Local Government, Robert Jenrick, to relax the rules on Covid-19 related business grants. Although Cornwall Council have given out over £232m to local business, more than any other local authority in the UK, some 20% of the funding remains unclaimed, because of inflexible government rules.
There are two pots of funding for local businesses. The first, non-discretionary pot, is prescribed by strict government rules and allows for second home-owners to claim the grant if their home is registered for business rates using a tax loophole. To their credit, many have not done so however, because they feel they cannot justify it and that the money can be better spent elsewhere. The Lib Dems have urged the Tories to close the loop hole but they have refused.
Meanwhile a much smaller pot of funding which has been earmarked for discretionary use by Cornwall Council to help genuine local businesses is oversubscribed. Liberal Democrats have urged the government to allow money which could be claimed by second homeowners to be used instead to help the 3500 local businesses ineligible for any Government Covid-19 grant support.
Adam Paynter, Lib Dem Deputy Leader of Cornwall Council said:
“The Tory announcement today that funding desperately needed by Cornish businesses is set to be taken back into Westminster coffers is a scandal. We urge the Government to change the rules immediately giving Cornwall Council the discretion to divert all remaining funds towards local businesses who are in dire need of extra funding.
“To give funding to Cornwall which the Tory Government will allow second home owners, but not many local tradespeople, to access was a disgrace to begin with. The announcement that rather than allowing Cornish businesses in need to access discretionary funding they will be taking it back into the treasury in London beggars belief.”
“Lib Dems on Cornwall Council will oppose this decision and we are calling on the Tory MPs in Cornwall to join the fight.”