£140m grants for businesses to get through the pandemic
BUSINESSES in Wales will be offered grants from a £140m scheme to help them survive the coronavirus pandemic, the Economy Minister has said.
Ken Skates said the support package was the “best package of support anywhere in the UK”, but admitted it “can’t save every business and every job”.
Yesterday’s announcement came just hours ahead of the new local lockdowns for the Vale of Glamorgan, Torfaen and Neath Port Talbot, which came into effect at 6pm last night. It saw the three counties join nine other areas in South Wales experiencing restrictions.
Restrictions are already in place in Cardiff, Blaenau Gwent, Bridgend, Caerphilly, Merthyr Tydfil, Newport, Rhondda Cynon Taf, Swansea and Llanelli.
People are not allowed to enter or leave the areas without a reasonable excuse.
They will not be able to meet indoors with anyone they do not live with, with extended households suspended.
Mr Skates said up to £60m will be used to support businesses affected by the local lockdowns, with grants of up to £1,500 for retail, leisure and hospitality businesses with a rateable value of between £12,000 and £51,000.
Grants of £1,000 will be made available for small businesses with a rateable value of £12,000 or less and who can, like the businesses with a higher rateable value, demonstrate “material impact” from Covid19.
Discretionary grants of up to £1,500 will be made available via local authorities to businesses who are not registered to pay business rates. Mr Skates told the latest Welsh Government coronavirus briefing in Cardiff: “[The] new Local Lockdown Fund will help businesses and individuals in those areas experiencing local restrictions...
“It’s likely that over the next few weeks and months we’ll see a rolling programme of restrictions to help us respond to local increases in cases.
“We need to be dynamic in our approach to responding to coronavirus and none of us wants to see a national lockdown if we can avoid it.
“But we know that businesses in containment areas will need extra help. “We have worked incredibly hard to respond to Wales’ unique needs.” He warned that the coming winter was going to be “a difficult time for all of us”.
But he said the Welsh Government will be working in the national interest and to put in this additional package for Wales that complements the Job
We can’t save every business and every job
Economy Minister Ken Skates
Support Scheme announced by the UK Government last week.
Meanwhile, another £80m will be made available to help businesses prepare for the “post-covid economy”, with grants of up to £200,000 for larger businesses employing more than 250 people (with 50% match-funding from the business), with those applying having to sign an economic contract to “build back better” with a focus on the environment and equality.
Grants of up to £10,000 will be available to micro businesses employing up to nine people for projects, on condition they match this with their own investment of at least 10%.
Grants of up to £150,000 will be made available for small and medium sized businesses, with 10% minimum match funding required for small enterprise and 20% for medium sized businesses.
The funding from the third phase of the Welsh Government’s Economic Resilience Fund (ERF) will see wider support being provided to secure jobs and help businesses develop, as well as additional help for firms affected by local lockdowns.
Outlining the plans, Mr Skates said: “The third phase of the Economic Resilience Fund will take a different form.
“It will be designed to support businesses with projects that can help them transition to the new normal. To the economy of tomorrow.
It will be more than just getting through. It’s about the potential to thrive in the future, not just to survive in the present
“It will require co-investment from companies and a clear adjustment plan for a post-Covid economy.”
Some £20m out of the £80m grant fund will be ring-fenced to support tourism and hospitality businesses who will be affected by the winter months.
Mr Skates explained that “many” businesses in these sectors had recorded “zero or near zero turnover since March”.
The Welsh Government hopes to launch the scheme in the first week of
October, with applications open before the end of the month, allowing time for applications to be developed and with first payments made as soon as possible after.
Mr Skates said, adding that it “will no doubt make the difference between business survival and business death for thousands of enterprises”.
But he said the latest economic package would not be enough for the Welsh Government to be able to save some businesses from folding before the pandemic is over.
“We can’t save every business and every job,” he said. “To do so would require the sort of financial firepower that only the UK Government possesses in its armoury.
“But we’ve stood steadfast with firms and individuals throughout this pandemic and we’ve done everything in our power to ensure that a good business in 2019 will be a good business in 2021.”
The Welsh Conservatives’ shadow economy minister, Russell George, welcomed the announcement and said it was “crucial” the funds got to businesses “as soon as possible”.
But Plaid Cymru said Wales needed more “economic levers”, including lifting restrictions on the country’s borrowing by Westminster, in order to save the economy.
Its shadow economy minister, Helen Mary Jones, said: “Renegotiating the fiscal agreement would go a long way in dealing with our ability to react to these sorts of crises.”
Ian Price, director of business organisation CBI Wales Director, said: “While the Chancellor’s Winter Economic Plan did much to calm nerves, support jobs and help with cashflow, there is no doubt that many Welsh firms remain under extreme pressure – particularly in our vital hospitality and tourism sectors.
“With so many parts of Wales now experiencing localised restrictions, including in our major urban centres, the Welsh Government should be commended for stepping in to help firms that have been so negatively affected by Covid-19.
“We have called on both the UK and Welsh governments to work together and use every tool at their disposal to protect lives and livelihoods.
“These successive interventions do just that, although it’s clear more may be needed further down the line.”