Recommendation 3

Central government’s distance from the practical realities on the ground meant confusion, delays and uncertainty for small businesses and local authorities. Business, local authorities and MPs all experienced at times a lack of clarity about precisely which businesses were covered by which schemes, and experienced delays when seeking clarification from BEIS. BEIS published multiple iterations of guidance and related documents as it worked through issues it had not anticipated when the schemes were launched. Examples of difficulties cited to us included distinguishing ‘wet-led’ pubs from other pubs and assessing whether meals were ‘substantial’. In addition, many local authorities were relying on data and systems which could not easily be used to identify which businesses were eligible for grants. Local authorities were key partners in the delivery of many COVID schemes, but having faced financial pressures over recent years it is not clear how far investment in IT infrastructure has been maintained. The challenges faced by some authorities in administering these grant schemes underline the impact of likely underinvestment. Officials acknowledged that, in the early phases of the crisis, the connection between policy making and knowledge about delivery was ‘not as strong as we would have liked it to be’. When we pressed witnesses about the limitations in government knowledge about the variety of businesses and the capabilities of local authorities, HM Treasury accepted there were things they should have known but did not at the start of the pandemic. Recommendation 3: Within six months, the Department for Business and Trade should write to the Committee setting out how it proposes to improve its understanding of small businesses operating in different sectors and how it is strengthening its mechanisms for receiving and acting upon feedback from this segment of the business community.