Our Welsh Government support package for businesses is the most generous offer of help anywhere in the UK.
Our £1.7 billion plus business support package, which is equivalent to 2.6% of our GVA, complements other UK schemes and means that companies in Wales have access to the most generous offer of help anywhere in the UK.
Our Economic Resilience Fund (ERF) has been designed to plug gaps left by the UK Government’s package of business support. This is because we want to support as many businesses as we can at this incredibly challenging time.
So far our ERF has helped more than 13,000 businesses with more than £300m of support. It has also helped to protect more than 100,000 jobs that otherwise might have been lost.
Last week we opened applications for Phase 3 of the ERF with this latest round of support releasing a further £300m for businesses in Wales to help them deal with the economic challenges of this current firebreak and help them prepare for a post-Covid future as the UK exits from the Brexit transition period.
Our ERF 3 support comes in two main parts:
- First, a £200m package of Lockdown Business Grants to help those directly affected by the shorter term challenges of having to close during the firebreak, as well as those subject to local restrictions before it started. This element will provide more than 60,000 micro and SME businesses with urgent emergency finance to help them with fixed cost thru face during the firebreak and includes discretionary support available at a local authority level. £11m which has already reached businesses.
- Second, a £100m package of Business Development Grants to help firms prepare themselves for the longer term challenges they face. This element was intended not as day to day, emergency finance but and to fund projects that can prepare their business for a post-Covid and EU exit future.
The demand for the Business Development Grant element of the Economic Resilience Fund has been exceptional with nearly 6,000 applications received. The fund has been paused to allow an assessment of applications to be undertaken and payments to be issued to successful applicants as quickly as possible so we can start getting support into the bank accounts of Welsh businesses in the coming weeks.
In the first days we have already approved grants to micro business ranging from launching of a music and wellbeing programme to reducing energy costs via replacement of doors and windows, both of which secure jobs and investment for the future.
However, this pause does not affect the first and much larger element of the fund – the £200m ERF Lockdown Business Fund which remains open.
Funding is delivered collaboratively between the Welsh Government and Local Authorities. This element of the fund will provide the following to over 60k businesses:
- Retail, leisure and hospitality businesses forced to close (as defined by the regulations) during the firebreak lockdown period occupying a property with a rateable value between £12,001 and £51,000 will be eligible for a £5,000 payment.
- Every business eligible for Small Business Rates Relief occupying a property with a rateable value of £12,000 or less will be eligible for a £1,000 payment.
- A discretionary enhanced £2,000 top-up grant will be made available on an application basis for those businesses with a rateable value of £12,000 or less who are forced to close by the firebreak lockdown (as defined by the regulations).
- A further discretionary enhanced £1,000 grant will be made available to businesses on the same basis where they have been materially affected by local lockdown restrictions prior to the start of the firebreak lockdown period.
Businesses must be on the non-domestic rates (NDR) rating list for their local authority on 1 September. While some businesses will have properties that are eligible for an NDR grant, to receive any of the Lockdown Business Grants, businesses will need to register their details, as well as make a short on-line application to their respective local authority for the discretionary elements.
Local authorities are also delivering a £25m Lockdown Discretionary Grant for businesses that are closed or materially impacted that do not pay business rates and therefore not eligible
for the non-domestic rates (NDR) linked grants. Eligible businesses are able to apply for a grant of £1.5k and those who have been subject to local lockdown restrictions prior to the national firebreak are eligible for an additional £500.
I also recognise that the lockdown discretionary fund is fully utilised in a small number of local authority areas and others are close to be fully utilised. In response the Minister for Finance and I have asked officials to explore with Local Authority colleagues how we can re-purpose the un-utilised budget from the original round of Covid-19 NDR linked grants to provide more funding to support those business who are eligible under the discretionary fund.
The £300m ERF package is of course in addition to the HMT support available via the Job Retention Scheme and the Self Employed Income Support scheme which have been enhanced in recent days as we as a Government have requested. ERF is unique and additional for Welsh Business to access to support their viability and critically their employees.
Finally, I’m continuing to explore further options for supporting businesses through the pandemic, including to help them prepare for EU transition. My colleague the Finance Minister has set aside funding for a fourth phase of the ERF to support businesses and employees. We are developing a mechanism for businesses to register an interest in any future funds and I will provide a further update on next steps in the coming weeks.