The Minister for Regional Growth and Local Government, Simon Clarke MP, announced on 30 July that the UK government would be providing £20 million in funding to “help businesses across England get back on track”.
Small and medium-sized businesses can access grants of between £1,000 – £5,000 for “new equipment and technology and specialist advice”.
Who can get the grant?
The official document on the grant, and how to receive it, states unequivocally that “ the funding can be used to support all SMEs in all sectors“. (The emphasis is ours.)
How your small/medium-sized business can get the grant
The grants are supported by the 2014 – 2020 England European Regional Development Fund (ERDF) and have been allocated to Growth Hubs across the country.
To claim your portion of the fund, you must contact your local Growth Hub.
To find which Growth Hub applies to your business’s location, you can visit this LEP (“Local Enterprise Partnership”) Network Growth Hub page.
It is up to the Growth Hub itself to determine the size of the grant given to businesses. The grant will be determined based off local circumstances.
It is expected that each grant will “typically” be around £3,000, but as much as £5,000 may be awarded under “certain circumstances”, to be determined on a case-by-case basis.
But even if your business does not fall within the jurisdiction of one of the thirty-nine growth hubs, the government’s website states that they are working to “make this funding available quickly” for companies that do not have a Growth Hub they can apply to.
In such a case, you should probably contact the Ministry of Housing, Communities and Local Government directly using the details at the bottom of this article.
Unlike other schemes recently initiated by the government, this particular grant sum requires no financial contribution from the participating business. It is a straight grant and will not be deducted from your income later on, whether through National Insurance contributions or other tax payments.
How much was allocated to each Growth Hub?
Unsurprisingly, the North East, London and Lancashire Growth Hubs had the largest amounts allocated to them, with £1,833,503, £1,201,211 and £1,118,161 awarded to them respectively.
Greater Manchester came in a close fourth, winning £1,049,321 of the allotment.
Leeds City Region, Liverpool City Region, Greater Birmingham and other metropolitan areas also commanded sums close to the one million mark, while smaller jurisdictions like Buckinghamshire Thames Valley, Dorset and Hertfordshire received the minimum amount made available: £250,000.
In three months’ time, the take-up of allocations will be reviewed to “ensure it is meeting demand“.
The deadline for awarding all the grants is 21 February 2021.
What to invest your grant in?
An amount of £1,000 – £5,000 may or may not be significant, depending on your circumstances. Businesses were hit hard during the pandemic, with many still gasping for air as they try to come above water.
Whether your business was hit hard or not, the smart move is to prepare for hard times.
COVID hit all of us with shocking surprise, and too many businesses were caught flat-footed. If there’s one lesson we all learned, it’s that the scouts motto of “be prepared” is paramount.
In this tenuous phase post-lockdown, we have to be prepared for any number of the following things:
- A second wave and/or lockdown
- Slow economic recovery
- Less consumer spending as a result of job-security fears
Whatever you invest in, it must be in the direction of:
- Increasing your efficiency.
- Improving your chances of getting in new business.
- Preparing you and your business for future lockdowns should they ever occur again e.g. remote working tools or video conferencing software
As a result of the above considerations, some of the technology tools you might consider investing in are:
- Email marketing software
- CRM software
- Social media management tools
- An improved website
- Various online tools designed to improve efficiency
- Specialised accounting software
What is considered a “specialist professional service” for this grant?
The government guidelines above specifically mention “human resources, accountants, legal, financial, IT / digital” as examples of “specialist professional service” that small businesses might want to invest in using the grant.
This means that all of the following activities would be considered valid for purposes of the grant:
- Accounting services
- Bookkeeping services
- Legal advice
- Consulting services for digital marketing (e.g. online advertising)
- Financial advisory services
- Search Engine Optimisation
The list, really, is endless.
Obtaining assistance with the government grant
If you need any assistance with applying for the above grant or determining if the service you wish to invest in is covered by it, please feel free to contact us any time, even if you are not currently a client of ours.
Shoaib Aslam is the co-founder of Pearl Chartered Accountants, a UK-based chartered accountancy firm that has multiple locations across London. They are experts in helping startups and established businesses with all aspects of growth, strategy, scaling up, accounting and tax planning.