Government red tape needs to be cut to stop business grants going to second home-owners

Cornwall Liberal Democrats have written to Robert Jenrick the Secretary of State for Communities and Local Government urging him to relax the rules on Covid-19 related business grants.

Although Cornwall Council have given out over £232 million 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 are urging the government to allow money which could be claimed by second homeowners to be used instead to help local businesses.

Adam Paynter, Deputy Leader of Cornwall Council said:

“It is a scandal that funding that could be used to help local businesses get through this crisis is going to second homeowners or remains unused because of government red tape. We urge the government to change the rules immediately giving Cornwall Council the discretion to divert all remaining funds away from second home-owners towards local businesses who are in dire need of extra funding.” 

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