'Mark Drakeford has stabbed us in the back': Businesses say Welsh subsidies are under England's or Scotland's

The Welsh Government originates under fire because of its latest grants on offer to businesses can not survive the pandemic.

Businesses say they have been betrayed and left to fail – stating that Wales' latest group of grants is far less generous on offer in Scotland or England.

Angry owners described the scheme like a betrayal saying they felt "stabbed in the back" or "punched in the stomach". Most are most frustrated by the processes they need to go through and also the lack of restart grants available to help people reopen their businesses.

The Welsh Government said that it was wrong to compare the most recent funding in Wales and England.

A Welsh Government spokesperson said: “The latest instalment of financial support for businesses still impacted by Covid restrictions is on top of the previous waves of support that have been available since lockdown started in December. The UK Government funding for England covers a longer period. Therefore, it is wrong and misleading to compare the 2.”

We've talked to:

• A gym owner who said he'd get an lb18,000 one-time payment in England, but could claim just lb5,000 in Wales
• A pub owner who has spent lb20,000 making his pub Covid safe and beer garden bigger and can lose out on a grant
• A pub owner who has spent lb15,000 reopening her business, and who'll receive lb2,500 – just one month's rent
• A mid-Wales pub owner who says the "insulting" lb2,500 he will receive won't cover rent and gas bill for 2 months
• A Welsh tattooist who says he won't get a penny, despite English equivalents receiving support

Welsh Government announced on May 11 that its latest support package through the economic relief fund (ERF) would help businesses to meet ongoing costs through to no more June as they get ready for re-opening and more normal trading conditions.

Businesses could see for the first time on Monday how much they are eligible for and today the money available is even less than you are on offer in Scotland or England, the factors doesn't seem possible to allow them to meet and excludes numerous businesses which really need help.

Since the data was launched, business owners have given us tens of questions regarding issues with the scheme, including asking the way the figures happen to be determined, why the formula to determine who gets funding has changed, and eligibility.

The initial pr release from Welsh Government said businesses could claim as much as lb25,000 each as part of a lb200m package of presidency support. However businesses dispute any premises in Wales would qualify for the highest quantity of funding.

In Wales, grants will be decided by the number of full-time equivalent staff a company has, the minimum available is lb2,500 and more lb25,000, based on whether businesses were instructed to close fully or partially.

In England, the cheapest amount available to hospitality, accommodation, leisure, personal, care and gym businesses was lb8,000 and maximum was lb18,000.

In Wales, businesses need to meet a long list of criteria including proving they've were built with a minimum of 60% reduced turnover in May and June 2021 as compared to May and June 2021 caused directly by on-going Covid-19 restrictions.

Businesses say not only is the fact that more complicated than the English system, it is impossible to prove because May and June 2021 are yet to be concluded.

In Wales, if your business continues to be partially closed, e.g. a hospitality venue which has been in a position to open outdoors, and has one to three full time equivalent staff (FTE) it is a lb2,500 payment. It doubles to lb5,000 for 4 to 9 FTE. Between 10 and 49 FTE staff it is lb7,500 and lb10,000 for 50 to 99 staff. Individuals with over 100 FTE can claim lb15,000.

That means a business with 49 employees is only going to get lb2,500 more than one with nine. That means lb62.50 per employee for the entire three month period covered.

Those involved with hospitality in Wales said few, if any, businesses here could claim the maximum amount of lb25,000 on offer through this latest funding because it is only for businesses forced to close throughout May and June and it has more than 100 FTE staff. One pub owner explained the country's biggest nightclub wouldn't obtain that many staff on its books.

When asked how many businesses were eligible for the largest grant, Welsh Government failed to answer.

There happen to be a number of different grants on offer to Welsh businesses during the pandemic but, businesses the goalposts were changed in March once the last batch of funding ending. It has only restarted with this announcement of the so-called Economic Resilience Fund, published by Welsh Government on May 10, meaning there was no financial support on offer in April.

They had been expecting amount similar to those on offer in England or Scotland by their Governments.

Applications open on May 24 meaning money will likely not reach businesses until June.

The Welsh Government says these latest grants are on surface of other financial support packages.

A spokesman said: “A hospitality business with 10 employees in Wales will have received as much as lb52,500 to help using its costs because the oncoming of this year, including this latest phase of support. This is in addition to the towards the Welsh Government's twelve month business rates holiday and also the support provided by the united kingdom Government.”

When inspired to clarify that comment, because the English restart grants were available to hospitality, leisure leisure, tourism, non-essential retail and private care, not just hospitality businesses, the spokesman added: "This package shouldn't be viewed in isolation because it is made to cover the restrictions falling from May. The most recent scheme is sector agnostic but made to cover latest impacts. The minimum any business having a rateable property may have received in the latest restrictions is lb10,000, around lb1,000 a lot more than the England equivalent."

On Monday, people who claimed a grant Self-Employment Income Support Scheme (SEISS) the website told them these were ineligible and also the Welsh Government says it's not changed eligibility but has "provided further clarity around the Eligibility checker for absolute clarity as well as in response to what exactly made".

They say SEISS recipients qualify to apply – something some of those finding the grant say they'd not learned.

John Fitzpatrick runs two pubs in mid-Wales, the Crown and Anchor at Llanidloes and also the Mid Wales Inn in Pant y Dwr

"Over the various lockdowns we've scrapped thousands of pounds of stock, beer, soft drinks, food and snacks. It's all gone in the bin.

"Anything you can imagine that is stockable has been scrapped and now we have to replenish it.

"We have got some credit terms with suppliers, but that relies on us selling all the stock.

"We have managed to negotiate reduced rent but we have rent, gas and electricity to cover and also the maintenance of the buildings which we'd normally do through our profits.

"We are entitled to lb2,500 for each pub.

"To restock the firms, we carry about lb2,000 price of draft beers and also the same again in spirits, food and snacks. Therefore we have got to replenish lb4,000 to reopen.

"We're at 40% capacity because of social distancing. Luckily, we have a large garden at the Crown and Anchor but obviously the elements has been awful. We were open for many from the Bank Holiday weekend, and that we had a marquee to achieve that, but due to the storms we lost that, that is another lb2,000.

"In England, businesses can get as much as lb18,000. We were dreaming about that, but we don't trust Mark Drakeford anymore.

"We can see now why, despite his ability, he didn't release the figures prior to the election since there would have been uproar.

"We've got to put prices up on everything. It's the only method we are able to try to claw anything back. We will lose customers, people can go elsewhere, that's their right however the breweries and wholesalers using the food need to make money too.

"The lb2,500 is definitely an insult, particularly when we're needing to restock on your own.

"We're able to wind up putting 10 or 11 people out of work."

Steve Board runs the Whistling Badger in Llanidloes

The criteria Steve Board will have to meet at his mid-Wales pub is that his business has lost 60% of turnover compared to 2 yrs ago.

In recent times, he has spend lb20,000 on changes towards the inside of the pub and tripling how big the beer garden so he can continue to take anywhere near the amount he was previously taking.

It means he won't have the ability to meet that 60% criteria, because it takes no account from the cost he has spent attempting to keep the company open.

"Within the first week of reopening, I took lb11,000 then the rain came as well as in the two consecutive weeks I took lb3,000 and lb4,000 per week. So week on week, I've lost large sums but that isn't likely to show when compared with 2 yrs ago after i didn't possess the extra facilities. There appears to be hardly any recognition of what we have done.

"I don't understand why out of the blue we have got these new criteria when all along we've been doing the work on non-domestic rates. Personally i think completely mugged off.

"In England, you have a restart grant to restock before you opened. I had to put lb5,000 of stock within the cellars prior to this scheme being announced and today I won't be also eligible".

Dean Hancock is a tattooist in Swansea

His business was permitted to reopen on April 12. The Welsh Government criteria imply that he'll not be eligible because it is just for businesses impacted in May.

"We reopened on April 12, a few weeks after hairdressers. We had received a lb5,000 NDR grant [grants determined on the rateable value] and that we needed to use that to purchase stock because all of our inks and our needles expire. PPE costs a lot of money too and also at that time, i was told it needed to last until March 31, they moved the goalposts and said they couldn't do anything until following the election.

"We might be able to claim something because there exists a diving school in the shop too which couldn't open until May but we don't know now if you will see another NDR grant but if we were just a tattooist, we wouldn't meet the requirements. We can't operate a business like this, it seems like we have been ignored and discriminated against. Bigger businesses will be able to claim grants and relief when they're more likely to be able to absorb the losses. It's me, my spouse and few other tattooists, we can't afford these costs. We have family commitments, a roof to help keep over our head and youngsters to give.

"In England, tattooists were eligible for the lb8,000 or lb12,000 restart grant for their businesses."

Paul Evans runs First Class Gym Limited in Bridgend

If Paul Evans' business was at England because of its rateable value it would have been entitled to the lb18,000 grant. As he has four FTE staff, in Wales, he's entitled to lb5,000.

Once the election was called, businesses were advised payments would need to hold back until following the election but that the money was ready for the next First Minister to distribute.

He has to apply via his council, rather than Welsh Government, meaning he can't apply until May 31, instead of May 24, under the Welsh Government application and has learned the cash could take 6 weeks to come, which may therefore be mid-July.

"It's just like a punch in the stomach, he said. "We've waited for this month and were counting down the days to obtain the money."

"I was given lb5,000 in January and February to obtain us through to March 31, then suddenly that date was changed which had to last until June.

"I was shut to help keep people safe however the deal was that we were paid. Then we were told it wouldn't come until after the election and it was delayed again. However the English system hasn't only been much simpler, however the money has been much quicker to come."

Cheryl O'Connell runs a restaurant in north Wales

Cheryl employs nine staff and under the latest Welsh Government funding, her business could be entitled to a lb5,000 one off payment.

But, because she's self employed like a sole trader she is not entitled to this funding because she receives SEISS – Self-employed income support.

That is a personal payment to her, not on her business.

During the pandemic, there has been three rounds of ERF funding, but she isn't entitled to any of them because she's self-employed.

She continues to be in a position to have the NDR but that stopped in March and there is no word if that will restart.

If she was a limited company director, she would be able to claim furlough plus business grants.

"In England, they haven't got this barrier simply because they have just provided the start up grant and everybody gets not, it's not based upon SEISS or anything else.

"I haven't had anything since March that's two months with no funding. I feel they've moved the goalposts and changed the factors and are penalising hospitality, the sector that has been worst hit.

"I've now got stock to order, equipment to obtain support and running. We have been closed over winter and that i have gas technicians, electricians and fridge engineers in. We were closed by having an hour's notice in December and I supported that. I just feel now Mark Drakeford has stabbed us in the back".

Cat Beckett runs Tafarn Tu Hwnt I'r Afon in Pwllheli

"It's require me to pay approximately lb15,000, my final bit of personal savings, to be able to reopen, this is actually the price of purchasing stock, the extra staff required and also the additional PPE and signage etc to make sure we're fully compliant using the Welsh covid regulations.

"I am a sole trader and rehearse two full-time staff and, out of the box standard for many hospitality businesses, other staff are casual or seasonal.

"I'm only entitled to lb2,500, this sum doesn't even cover my rent for one month, let alone all the other overheads.

"I appreciate and am very grateful for the support received using the previous business grants etc, but which has recently been spent in paying overheads throughout the covid closure.

"Business rates relief is excellent but when you've got no stock to trade then there is no enterprise left so that you can claim the relief.

"The Welsh Government have encouraged individuals to take staycations this season, but if nothing is done to support us many will discover that there won't be any hospitality establishments open to serve them. This ERF grant feels like a kick in one's teeth for all of us small business owners once more. "

Welsh Independent Restaurant Collective

They say: "We're extremely disappointed using the support provided to businesses who've been closed since December 4.

"Reopening comes in a heavy cost, and lots of independent hospitality companies are already saddled with significant debts from months of closure while fixed costs stack up.

"Following a announcements during the election period that there would be proposals all set to go for that new government, we are extremely concerned this funding support isn't even open for application until May 24 with funds unlikely to achieve businesses until June.

"Concerning continues to be no support since March this leaves many inside a precarious position.

"We believe there's a simpler and much more straightforward solution which would be more similar to the restart grants in England (lb18,500) and Scotland (lb19,500). The current funding provided by Welsh Government is in the region of lb5,000 to lb7,500 to have an average pub, cafe or restaurant.

"We think there's a failure to know the realities many companies who've been forced to close face, with further penalisation when you have attempted to maintain some trade just before indoor opening."

We asked Welsh Government numerous questions.

1. How were the criteria for the latest ERF grants drawn up? In England and Scotland it's on rateable value, however in Wales FTE. Previous grants in Wales have been based on rateable value. Why aren't these grants based on rateable value such as the rest of the country?

Packages are made in line with the restrictions in place at that time. NDR is effective in delivery of broad cross economy support. The most recent scheme is centered on businesses impacted by alert level three restrictions and the transition into level two. Retail for example started re-opening on the phased basis from 22 March. Hospitality businesses have remained closed indoors before the 17 May.

We have always used a mix of FTE and rates in our schemes to ensure grants aligns with costs and offers the purpose of protecting employees. For this round using the restrictions falling on particular areas of the economy as the Rates approach are only able to give a blunt tool with different property, we wanted to ensure less expensive for the money for that public pound. FTE and application ensure we can fund those most in need and influenced by the restrictions and never those that are largely able to operate.

2. Why are you able to not claim until May 24 (or May 31 if council administered) why is there no backdated support for April?

The premise of ERF is that it funds operating costs, helping businesses to pay for invoices falling 30 days in advance – utilities, rent etc. The previous package covered February and March invoices covering the months of March and April. This latest package covers invoices in April and could so costs linked to May and June. Opening the checker per week in front of applications enables applicants to drag together the necessary information and apply in good time. This enables faster payments to make.

3. Will hospitality venues who opened outdoors when rules allowed be permitted to claim these grants?

Yes.

4. The number of businesses do you calculate is going to be eligible for the largest amount? It's been offer us that on the ERF criteria, the biggest nightclubs wouldn't be able to claim the maximum and "no one can reach that criteria".

The largest amount is designed for those businesses that are still closed, such as nightclubs.

5. The criteria says that you need to prove "reduced turnover of 60% or more in May and June 2021 as compared to May and June 2021 caused directly by on-going COVID-19 restrictions."

How can businesses show 60% discrepancy between May and June 2021 and the same months in 2021 once they haven't traded in June yet (or all of May by May 24 application date)

Clearly data for 2021 is a forecast and in line with the business' capability to operate – for instance reduction due to social distancing and impact on indoor capacity.

6. Will there be more NDR grants for all those not covered by ERF?

No. However, we all do have plans for a new round of development funding – more details follows.

7. Why can't non essential retail claim a restart grant, as it is in England?

A typical small retailer may have received as much as lb15k for the period January to April to pay for costs. Generally this is more than the combined amount of emergency and re-start grant a comparable company in England might have received.

8. What about sole traders? Self-employed people can claim as much as lb2,500 a month but that's the same as furlough, not business support. In England, there is no equivalent barrier. One business proprietor told us the web site told her she was ineligible for lb30,000 through the three ERF grants due to getting SEISS which total around 30% of that value.

She has NDR but that has stopped so her business has had nothing since March.

Discretionary fund continues to be opened throughout, as has NDR – with this round of ERF, SEISS recipients are eligible to use.