Grants and funding for development work – worth it?
There are plenty of grants and funding options available but choosing the right one for your project is like finding the proverbial needle in the haystack. This year we’ve had experience from both sides of the table: we’ve prepared applications for our clients and we’ve applied for grants for our own use. We know and understand the pain and frustration of going through the process and at times, you have to ask “is it worth it?”.
E4 environment has planning permission to build a new office with all the environmental bells and whistles. Getting planning permission has been a hurdle in itself but now we need to find around £150k to build it. We found a couple of potential funding opportunities: Greenshoots funding was a grant that paid up to 40% of the total (approved/relevant) costs. Its objective was to increase growth of business and had a low carbon objective. It seemed we had the perfect project. An expression of interest was submitted and we successfully got through to the next round. Then came the rub. We had to provide 3 quotes from building contractors. To get the quotes we needed to provide a tender with the building specification details and to provide that we had to satisfy the building control regulations and before we could do that we needed to get planning permission by completing a bat survey (which has to be carried out between May and September). So whilst we ticked the boxes, we couldn’t achieve this in the timescales under the grant.
Next we applied for a Marches LEP loan. The loan was for those that required at least 0.5M for a development project that may not otherwise be started through lack of funds. Again, we ticked the boxes and got through the first round. Then came rub – planning permission required, a “red book” valuation was required, detailed cashflow forecast was required, a marketing plan was required. The cost incurred in putting this together must have been in the region of £20k and the whole process took so long that we’d begun to think that this really was not worth it. The benefit was the loan but on the downside, the rules were more like the rules associated with a grant where you claim back what you pay for (but how can you pay for it if you don’t have the money to start?), you don’t know what the interest rate is, you have to have surveyors and a raft of other folk to check that you’re doing what you say you’re going to do, you have to complete a tonne of paper work every other month and there’s a sense that your project is no longer yours it’s theirs (in this case Marches LEP). And at the end of the day what have you gained over and above getting a bank loan except a massive headache. After all, they get all their money back with interest. I will not be recommending this option to any of my clients unless they are willing to add on more costs to cover the administrative burden and have totally exhausted any other option.
On the plus side, we have had some successes getting funds for some really interesting projects including planting woodlands in England and now in Wales. We’ve also been completing some exciting research on under-sowing maize with different crops. This work has demonstrated how the soil can be improved and set the path for rolling out the activity in future.
Some of our other clients have benefited from grants awarded under STEPS and leader funding which are coming up again for the New Year. If you’re interested and want to find out more contact us. The deadline for expressions of interest for Leader is the end of January 2017. https://www.gov.uk/guidance/rural-development-programme-for-england-leader-funding
My top tips for applying for grants and funds:
- Pick the fund to fulfill your project and do not make up a project to fit the fund
- Check the constraints and limitations of the grant e.g timings, payment terms, paper trail, restrictions
- Be aware and allow for the administrative burden as an additional cost to your project
- Prepare a business plan including the financial and marketing plans
- Make sure your current business is in good shape