By Ben Kerrigan-
West Midlands councils have been ordered to hand back millions of pounds in Treasury grants designed to help struggling businesses.
Birmingham Council will be forced to return a total of £231 back to the government, comprising of £214m it received back to the Treasury, and £17 million to central government in the face of a desperate financial situation due to coronavirus and restrictions designed to stop the virus spreading..
The demand for a return of the funds comes after the councils failed to distribute the allocated funds within a reasonable deadline set for the allocated purposes. The Council now faces the uncomfortable challenge of having to refund the moneys which were not used for their original purpose. Funds given to councils are expected to be used effectively within a reasonable time scale, and to cover all necessary areas.
An insider from Birmingham Council anonymously told The Eye Of Media.Com: ”The council has been told it will have to fork out millions and return to the treasury. The demand is a burden to the council, especially with ongoing restrictions, and tougher ones to come for businesses.
In a way it is a good thing because I’ll tell you what, many of these guys would just sit on the money and enrichen themselves. It is good in that way, but bad in the sense that there are many businesses that could do with a high injection of cash, you see. I think the government feel they should have used a lot of the money by now to change things, but they haven’t done that yet. Not enough anyway. I suppose the money can go to better uses.”
New Package
The British Government is expected to announce a new, major package of financial support for firms affected by the latest round of local lockdown measures, which are due next week.
Government data shows how much support for local businesses was allocated to each local authority, and how much they distributed. They reveal that Solihull will have to repay £2.3 million, Sandwell will have to pay £16.2 million and Wolverhampton will have to repay £8.6 million.
A new package will take into account the precise needs of each area, including the hospitality sector, homelessness, and is expected to be distributed according to those areas affected most by the coronavirus.