Small Business Grants Fund

(asked on 6th May 2020) - View Source

Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, if he will make an assessment of the potential merits on an application to the European Commission for a derogation of State Aid rules in relation to local authority business support grant payments.


Answered by
Paul Scully Portrait
Paul Scully
This question was answered on 12th May 2020

Although the UK has left the EU, under the terms of the Withdrawal Agreement, the EU State aid rules continue to apply in the UK until the end of the Transition Period.

Whilst the European Commission has declined to suspend the State aid rules because of the Coronavirus pandemic, the Commission has introduced some welcome flexibilities into the rules to deal with the impacts of the Coronavirus, in the form of a Temporary Framework. This facilitates aid going to the companies who need it most, quickly and efficiently.

Following work by BEIS officials, the COVID-19 Temporary Framework was approved by the Commission under the Temporary Framework on 6 April. This allows public authorities to introduce their own aid measures without the necessity of obtaining an individual Commission approval. This provides cover for measures such as the Retail Hospitality and Leisure grants from local authorities.

I would also add that other local authority support, such as Small Business grants, can be given under the normal de minimis rules. These allow up to EUR 200,000 to be given to a business in a three-year period. De minimis aid can be received in addition to Temporary Framework aid.

The combination of these and other measures constitute an unprecedented programme of Government support for business to address the impacts of the Covid-19 pandemic.

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