South Tyneside Business Growth Grant Scheme

Funded by UK Government
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Background 

The grant fund will support inward investment and the growth of companies in South Tyneside. It will provide capital funding for:

  • the development of land for employment use
  • the improvement of existing premises in the borough
  • the introduction of new technologies or processes
  • launching of products services to new markets
  • adopting new or improved products or services

Grant support will be linked to local job creation and apprenticeship opportunities for South Tyneside residents.

Eligibility Criteria 

To receive a grant, businesses must be: 

  • A small or medium enterprise/business (SME – employing fewer than 250 employees and with an annual turnover of less than €50m or an annual balance sheet less than €43m. 
  • OR a business which forms part of a large sized company but operating as an entity within its own right and employing fewer than 250 employees in the North East, 
  • A business with existing operations in the area or planning to locate new operations in the area. 
  • Operating within an eligible sector. Companies in the following sectors are not eligible for this Fund: 
    – Agriculture 
    – Fishery and aquaculture 
    – Banking 
    – Insurance 
    – Tobacco and tobacco products 
    – Construction or decommissioning of nuclear power stations 
  • Planning an eligible project. The following activities are not eligible for this Fund: 
    – Provision of local social welfare facilities e.g. hospitals, hospices, nursing homes, fire stations, child-minding facilities, sports facilities, parks, public libraries
    – Building and renovation of housing
    – Provision of public services or activities to supplement public services e.g. social housing, school age education
  • Businesses in financial difficulty will be subject to additional due diligence.

 Eligible Projects

Companies must be-

  • Planning an investment involving eligible expenditure (see below for details) of at least £67,000 to expand existing operations in the area or establish new operations in the area, leading to the creation of additional employment in South Tyneside. 
  • Planning to create additional employment commensurate with the level of grant awarded (guideline: 1 net additional full-time job per £10,000 of grant). 
  • Able to cash-flow the entire investment, as grants are paid in arrears. Grants may be paid in instalments, based on eligible expenditure incurred and defrayed. 
  • Able to finance the balance of the investment cost, as the grant cannot finance more than 30% of the eligible cost. Small companies (less than 50 employees, see SME definition above) may apply for up to 30% of their eligible expenditure and medium-sized companies up to 20% and large companies up to 10% in accordance with the Subsidy Control Regulations. The grant must be the minimum necessary for the investment to go ahead (see below). 
  • Able to complete the investment, including incurring and defraying enough eligible expenditure, by 31st December 2024. 
  • Able to achieve the agreed increase in employment by 30th September 2025. 
  • Able to maintain the additional productive capacity created by the investment for a minimum of 5 years following the completion of the investment; and: 
    – where the grant is used to purchase premises, these must be retained for a minimum of 15 years; 
    – capital works on a site owned by the grantee must also be maintained for a minimum of 15 years; 
    – where the grant is used to acquire premises under a lease, these must be retained for a minimum of 5 years; 
    – capital works on a leased site must be maintained for a minimum of 10 years; 
    – plant, machinery and all other tangible assets must be maintained for a minimum of 5 years. 
  • Able to maintain the employment created by the investment for a minimum of 3 years following the creation of the posts. 
  • Able to show that the investment would not lead to the displacement of economic activity or employment in other businesses in the area. 

What types of expenditure are eligible? 

Grant support may only go towards capital expenditure to which no legally binding commitment has been made and which leads directly to the expansion of an operation or the establishment of a new operation in South Tyneside. 

Eligible expenditure may include any of the following items: 

  • Land and buildings (land costs cannot exceed 10% of the total eligible investment cost, and professional fees should not exceed 12.5% of the total eligible works cost) 
  • Premises lease costs 
  • Premises fit-out costs 
  • Plant, machinery and other capital equipment 
  • Revenue costs directly associated with a capital investment (e.g. professional fees, installation costs etc.)

Additionality criteria: 

Grants will typically be between £20,000 and £50,000, unless the applicant can demonstrate that the project would create exceptional impact. The table below outlines the appropriate intervention rates and the minimum/maximum level of financial support allowable accordingly. 

The amount of grant applied for must be the minimum necessary for the investment to go ahead. Applicants must be able to demonstrate either that they have exhausted all alternative sources of funding or that there is a credible reason why other finance such as a loan or equity investment could not be used instead of a grant. 

Grants may only be awarded where there is credible, verifiable evidence of one or more of the following: 

  • That the investment would not go ahead without grant support. 
  • That the investment would not go ahead at the scale proposed without grant support. 
  • That the investment would not go ahead within the timescale of this programme (1 July 2023 to 31 March 2025) without grant support. 
  • That the investment would not take place in South Tyneside without grant support. 

The table below demonstrates minimum level of spend required at intervention rates of 10%, 20% and 30% depending on company size, in line with Subsidy Control rules: 

Grant Amount £ Small co. min spend (at 30% intervention)  £ Medium co. min spend (at 20% intervention)  £ Large co. min spend (at 10% intervention)  £
20,000 66,666 100,000 200,000 
50,000 166,666 250,000 500,000 

All grant applications would be subject to an independent appraisal.

Please e-mail business@southtyneside.gov.uk or telephone 0191 481 3456 for a copy of the South Tyneside Business Growth Grant Scheme Application Form.

Please see the South Tyneside Business Growth Grant Scheme Privacy Notice