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Government to investigate Local Authority failure to pay out grants

The Government is to investigate why Local Authorities have failed to release almost £1.6bn worth of grants to businesses, the Events Industry Alliance (EIA) has said.

An investigation by the EIA (an alliance made up of the AEO, AEV and ESSA) found that 82.5% of the total funds given by the UK Government to councils had not yet been paid, despite the funds being issued on 31 October 2020.

The EIA submitted a Freedom of Information request on 26 January and despite the statutory deadline for responses being 23 February, only 128 councils out of a total of 314 English authorities responded to the request in full and on time, although some are reported to have requested extensions to the deadline. 

The Additional Restrictions Grant (ARG) was announced by the Government on 31 October and a total of £1.6bn has been made available to local authorities to distribute to businesses that have been forced to cease activities due to national Covid-19 restrictions. Individual ARG payments could be worth up to £3,000 per company per month and represent a critical amount for many smaller exhibition suppliers and organisers along with their counterparts in the hospitality and leisure sectors.  

“We welcome the Government’s decision to urgently investigate the non-payment of £1.6bn in Additional Restrictions Grants to eligible businesses by local councils, however this action could have been taken two weeks ago when the EIA first raised this issue following our freedom of information request,” said Andrew Harrison, director of the Event Service and Supplier Association, an EIA member. “It is vital that we now see urgent action on payments, as exhibitions and events business desperately need the funds they have been promised as well as further support over the coming months, so they can survive until national restrictions are lifted.”

Government response

Following the EIA’s request for more information on the level of payments to be made public, last week the Department for Business, Energy and Industrial Strategy (BEIS) published its own data that showed an even lower level of payments than the EIA’s investigations had uncovered. 

The Daily Telegraph reported a response from the Government 25 February, stating that “a senior government source” had told the paper that ministers were “concerned” by the slow delivery of the grants by local authorities after giving councils “clear guidance”. The Telegraph also reported that officials are understood to have approached councils to find out why the funding is not being sent out at speed after cash-starved firms were dealt another blow by winter Covid-19 restrictions.

The EIA has written to the chancellor, business secretary, and head of the Association of Local Government urging them to take urgent action to ensure the blocked payments are released to eligible businesses. The EIA’s letter also repeated the organisation’s call for targeted support to be given to the events and exhibitions sector in the forthcoming budget, due 3 March, and to ensure that any new schemes do not see the same delays that have afflicted the ARG programme. 

Latest responses from Local Authorities

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