Business owners who were poised and ready to apply for the next round of funding to help them through the fire-break lockdown have found the cash fund has been suspended with no sign if it will re-open again.
The Economic Resilience Phase Three Business Development Grant opened on Wednesday and was due to run until November 25, but the Welsh Government was forced to suspend applications after just 36 hours after over 5,500 businesses applied.
It said this was down to the high number of applications received and that it was continuing to explore further options for supporting businesses through the pandemic.
But the suspension of the scheme means some businesses, forced to close due to the fire-break regulations, say they have been left reeling without any financial help at all.
For the family-owned Cafe Citta in Cardiff, the grant is make or break for its future.
Owner Diana D’Arezzo said: “We have missed out on every single grant that was meant to help small businesses. It is vital so that we can re-open. Unless they extend furlough we will die, but the ERF funds will mean we can re-open and limp along. I was poised and had my application ready to go; this was the one.”
Because the popular Italian restaurant had been closed up to the point when fire-break was introduced, it means it cannot access the £5,000 grant which has also been made available to some businesses.
“I spent the past day and a half trying to apply for the Business Wales ERF Phase Three business development grant as a micro business for £10,000 to help re-open and go forward,” added Mrs D’Arezzo.
“It opened on October 28 and was due to run until November on a first come first served basis. I tried applying this morning [Friday] and it has been suspended due to high demand after a day and a half. There are no funds left. We are so upset. Surely they must release more funds?”
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Andrew RT Davies, the Conservative MS for South Wales and Central, said the Welsh Government economic response was “nothing short of shambolic”.
Mr Davies said: “In the summer, Mark Drakeford used to trumpet the fact his government put efforts into planning first and making the announcement second, but that has been spectacularly lacking this time around.
“Regrettably it is symptomatic of an incompetent socialist regime that doesn’t have a clue about the economy and has little to no experience of running a business in the real world.
“I’m furious by this lack of care and attention for jobs in my region and the First Minister needs to pull his finger out and ensure people’s livelihoods are protected and that businesses can access vital support.”
Another one to miss out was Lee Powell, owner of Celtic MEP, a building engineering services company based in Bridgend.
Mr Powell had set aside Friday morning to work through the application process, which he said was “more in-depth this time round” only to find it was suspended late on Thursday afternoon.
Mr Powell, who employs 40 people in his business, said that much of the kitchen and bathroom side of his operation had been wound right down.
“It’s just a case of trying to get hold of the grants and anything we can to try and survive,” he said.
“It would certainly help because this year has been a struggle. We’ve lost money throughout the lockdown although the furlough scheme did help. This finance would be a big stepping stone.
“I wasn’t late doing it, they were late opening it and on the second day out of four weeks, they stopped it. I just think it’s ridiculous.
“I had collated all the information and I had everything ready to go because you only have a 20 minute slot to fill it in.
“It’s really frustrating. I haven’t written it off. I’m hoping they will open it back up.”
Speaking about the “bewildering set of options” available to Welsh businesses, the First Minister said he understood the confusion and distress caused by the “complexity” of the schemes but that it was in fact welcomed by businesses.
During his Friday lunchtime briefing at the end of the first week of the fire-break lockdown, Mark Drakeford said: “Of course I understand that when we make schemes available in Wales over and above the schemes available through the UK Government that this does add complexity.
“But truthfully I think it’s a complexity that is understood and welcomed because with that complexity comes £500m.”
The fund is designed so the “gaps in the UK schemes can be filled,” and “the complexity is the price that comes with that”, Mr Drakeford added.
“We have had a very large response already to Phase three of the ERF and that tells me there are thousands of businesses in Wales that want to get the help we are making available to them.”
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Colum Sullivan who owns Sadie and Frank’s Playcentre in the Vale of Glamorgan, said his business had been “significantly financially impacted” by Covid-19 restrictions, being one of the first to be asked to close and one of the last to be allowed to re-open.
Mr Sullivan said he had re-opened after the first lockdown just under a break even scenario. He explained: “We’ve had to change our business operation significantly as a result of on-going restrictions, reducing footfall and therefore revenue. This grant would have been a lifeline for us, and I understood that there was to be monies ring-fenced for hospitality, tourism and leisure, a category that we come under.”
He had spent hours putting together a business plan and a business case to apply for the fund only to see a message that the fund had been suspended when he pressed submit.
“I don’t know if we’re going to be able to submit it now,” he continued. “It is incredibly frustrating when we invest considerable time in putting together a comprehensive application only to find that the process has been suspended after a day.
“Every business out there realises there would have been a lot of businesses applying, why didn’t they hold out until the end of the period they said they would and then evaluate each one at the end.
“The money would have a massive impact. We are fighting to stay open. This grant could be the difference in helping our business to thrive, or force us towards some difficult conversations about closing.”
He said he would be applying for the small business rate relief, which would provide £1,000. But that “goes nowhere”, added Mr Sullivan.
“We’re quite happy to wait for this money but it’s almost like the door has just been slammed in our faces,” he said
The Welsh Government confirmed that the £100 million business grants element of the Welsh Government’s Economic Resilience Fund (ERF) was fully subscribed with more than 5,500 businesses applying for support.
The Government website said: “Demand from businesses of all sizes across Wales has been received since the latest round of the ERF Development Grants opened to applications at 3pm on Wednesday. The eligibility checker for this round of the fund was launched earlier this month.
“The £100 million business grants are part of the £300 million made available in the third stage of the ERF by Welsh Government to support businesses continuing to be affected by the coronavirus pandemic. £20 million of this is ring-fenced for tourism and hospitality businesses.
“Welsh Government has confirmed that applications will now be processed as quickly as possible and it expects to start getting support out to businesses from the middle of November.”
Economy Minister Ken Skates commented: “The importance of the Economic Resilience Fund to Welsh businesses is evident in the sheer number of applications that have been received. We know that businesses have been preparing for this for some time, ever since the eligibility checker opened earlier this month.
“We know this is an incredibly difficult and challenging time for companies. We will work hard to get this much needed funding out of the door and into the bank accounts of businesses that need it as quickly as we can.
“We would remind those firms who do not qualify for business rates linked grants that they can also apply for help through their local authority.
“As a Welsh Government, we remain absolutely committed to doing all we can to support our businesses, our workers and our communities through these incredibly difficult times.”
A Welsh Government spokesman said: “We recognise what a difficult time this is for business and the high demand for the latest £100m business development grant element of our Economic Resilience Fund only serves to reinforce this.
“Due to the high volume of applications received and our commitment to getting funds out as quickly as possible to business, we closed the business development grant element of the fund yesterday (Thursday). We are continuing to explore further options for supporting businesses through the pandemic, including to help them prepare for EU transition, and are working to ensure that businesses who have not yet applied to the fund are able to register an expression of interest on the Business Wales website.
“Businesses can still register for and benefit from the £200 million Lockdown Business Fund element of ERF3 as well as apply to other UK Government-led schemes.”