Audit Scotland - Data gap limits analysis of Covid-19 business support

17 Mar 2022 10:06 AM

A detailed analysis of how Covid-19 business support funding was distributed during the pandemic is not possible due to gaps in data.

The Scottish Government provided about £4.4 billion of grants and non-domestic rate reliefs between March 2020 and October 2021, mostly paid out to businesses by councils. The government announced a further £375 million of support in December 2021 following the emergence of the Omicron variant.

Steps were taken to improve the management of funding during the pandemic. But there was not enough focus on gathering detailed data on how money was distributed and how quickly applicants received funding. This means:

The Scottish Government does not have an analysis of the total amounts paid out from the more general schemes to different economic sectors
For sector specific funding administered by national organisations such as Scottish Enterprise, around 20 per cent of payments cannot currently be matched to council areas
Similarly, information to enable wider analysis of how funding supported specific groups, such as the female owned businesses disproportionately hit by Covid-19, is not available from Scottish Government centrally held data.

In late 2021, the Scottish Government completed retrospective impact assessments to consider how business support funding addressed inequalities. A retrospective fraud review of funding that councils administered was also carried out. The government is currently undertaking a large data cleansing exercise to ensure that the datasets for individual funds, including those administered by councils, are complete.

Stephen Boyle, Auditor General for Scotland, said:

These business support schemes were administered at pace in exceptional circumstances. But knowing where the money went matters. To get future policy development and delivery right, it will be important for the Scottish Government to fully understand how funding was used to support specific businesses and groups over the last two years of the pandemic.

William Moyes, Chair of the Accounts Commission, said:

Councils' fraud arrangements are generally robust, but they were heavily relied upon to ensure businesses were eligible for funding during the pandemic. Councils will need to continue to work closely with the Scottish Government to ensure a better picture emerges of how money was distributed.