Covid-19: Stormont to recover millions in business grants

The Department of Finance has written to 480 businesses requesting the repayment of money issued under a Covid-19 grant scheme, BBC News NI has learned.

Following a review, officials are seeking to recover £4.38m.

A spokesperson said businesses could appeal the decision or apply for funding from different schemes.

The Localised Restrictions Support Scheme (LRSS) was established in October.

It is linked to the restrictions placed on businesses and has paid out £260m to more than 13,000 businesses.

The department said all applications were continuously reviewed to ensure the scheme was working within the regulations.

Payments are linked to the rating system which BBC News NI understands has made its administration complex, especially as restrictions changed.

Margaret Morgan owns a beauty salon in south Belfast.

She works out of the same building as beauty therapist Lisa Kirkwood.

Both business owners applied for the grants, were approved and received payments last year.

But there was a problem with the most recent payment, a lump sum of several thousand pounds which was delayed.

The same day Lisa received the payment into her account, she received an email saying she was no longer eligible and would have to pay the money back.

She said it was devastating: "One minute you are told this is coming through to you, then the same day I received an email to say my application was turned down, then I received the money into my bank account.

"We all just want to get back to work and earn money without having to ask for grants, it's very upsetting.

"It was a substantial amount of money which would help me until we open again.

"It is a very anxious time, I am very disappointed. It's just appalling."

Margaret Morgan said: "The issue seems to be that I share the premises with another business - we share a front door but we are on different floors.

"They are trying to say that we are the same business, that we are not sole traders.

"We have tried to prove by sending in things like letters from solicitors and accountants, pictures, tax codes. It's just frustrating because we need this money to survive and we have had to close.

"We are still paying rent, electric, heating, salon insurance - so we need the money to keep going.

"When the grants were announced we got a bit of breathing space and thought we would be ok, but for this to have happened, it just means stress and anxiety every day.

"When we were both granted the application, it was a lot of relief knowing that we were going to be ok.

"It is really stressful and has been really tough. I know there has to be caution on who they give the grants to but we are separate businesses and always have been.

"As time goes on, you're thinking, how long can any business survive without any funding because we can't."

Since being interviewed by the BBC, both business owners have been told by the Department of Finance that their applications will now be approved and paid out.

Incorrect payments occurred for a number of reasons, including:

Businesses can appeal the decision and provide further evidence which may result in payments continuing to some businesses, reducing the overall amount of overpayments.

It is understood officials believe a number of the 480 affected firms will be eligible for a grant scheme established by the department in March.

If a business cannot repay the amount, Land and Property Services has said it will enter into a payment arrangement.

A Department of Finance spokesperson told BBC Radio Ulster's Inside Business the scheme was designed and delivered at pace to support businesses through the pandemic.

"More than £260m in financial assistance has been paid out to more than 13,000 businesses under LRSS," the department said.

"Payments made to ineligible businesses under the scheme account for less than 1.7% of all payments made."