70,000 UK SMEs risk missing out on £1.5BN of coronavirus support grants

Office life

New analysis from reveals that the government has distributed almost one million SME emergency grants through the coronavirus pandemic.

However, ahead of the deadline this Friday 28 August, the consumer finance experts at money.co.uk have revealed that £1.5 billion worth of grants have gone unclaimed.

Within this figure, 69,543 SMEs that the government initially accounted for when estimating which businesses are in scope to receive a grant, are yet to claim.

The emergency grants were announced 17 March, to help provide cash flow to small to medium-sized businesses throughout the coronavirus pandemic.

Earlier in August, the government revealed that 10.8 billion had been paid out to businesses, highlighting that a significant chunk had gone unclaimed. However since then just 6,889 SMEs have signed for the grant.

While many are urging for the deadline to be extended, the government told councils that the deadline is to remain the same, and unclaimed funds will be returned.

Money.co.uk analysis reveals that Cornwall is the county with the most eligible businesses that are yet to claim. In fact 2,960 SMEs are at risk of missing out on grants from Cornwall Council.

Furthermore, a considerable amount of eligible businesses located in seaside towns, are estimated to not have yet claimed. This is despite the drop in tourism earlier this year, particularly through May and Easter Bank Holiday weekends.

Alongside Cornwall, four other councils along England’s coastline (Dorset, South Lakeland District, East Suffolk and Bournemouth, Christchurch and Poole Borough Council,) are among the top 20 local authorities with the highest estimated number of unclaimed businesses.

There are overall 28 Local Authorities that have so far paid out more money in grant funding than initially accounted for. Fourteen of which have been underestimated by over a million.

In total, these councils have underestimated grant funding by over £61 million so far.

Within the list, 26 of the councils have paid out grants that are higher than the country average. Therefore, it is possible that councils in such areas underestimated just how much each grant was worth.

However, despite overspending, it is great to see that out of the 5,537 businesses accounted for initially by Westminster City Council, all of them have in fact claimed and received an emergency business grant.

On average, each grant provided by the English councils is £12,269. Out of all areas of England, the London Borough of Camden has given out the most money per grant, providing SMEs with an estimated £18,852 per grant. This is closely followed by Royal Borough of Kensington and Chelsea (£18,740) and Westminster Council (£17,615).

Out of the list of 20, three quarters of Local Authorities paying out the most per grant are based in London.

On the other end of the scale, Hyndburn Borough Council (£10,360), Forest of Dean District Council (£10,722) and Rossendale Borough Council (£10,740) are paying out the lowest value per grant.

While Cornwall Council has the highest number of eligible businesses yet to receive a grant, they have in fact paid out the greatest amount of emergency funds (£236,670,000). This is followed by Birmingham City Council (£210,110,000) and Leeds City Council (£153,765,000).

On the other hand, the Council of the Isles of Scilly (£4,075,000), Oadby and Wigston Borough Council (£11,630) and Epsom & Ewell Borough Council (£9,945,000) have provided the lowest amount of grant payments across England.

Salman Haqqi, personal finance expert at money.co.uk says: “Back in March, the chancellor announced a whole host of emergency measures to try and protect the economy from the impact of the COVID-19 pandemic. This included the Small Business Grants Fund (SBGF) scheme and Retail, Hospitality and Leisure Business Grants Fund (RHLGF), both of which end on Friday.

“With the deadline for grant applications fast approaching, it is imperative that businesses that need support and are yet to claim, assess their financial situation and if needed submit their claim urgently.

“While there has been much confusion in the past with regards to eligibility, now is the last opportunity for businesses to find out if they are eligible and how much funding they could apply for. With this in mind, we have pulled together a coronavirus business guide to help business owners understand what support they are eligible for.”