Two new streamlined routes under the subsidy control regime

The Department for Business and Trade (DBT) has published guidance on two new streamlined routes under the subsidy control regime.

This follows clear support for the three existing streamlined routes introduced in 2023, subject to a consultation on the subsidy control regime, which we discussed in a previous article. Taking each of the new routes in turn we will explore what they seek to cover and provide some helpful information.

The two new routes announced are for:

Arts and Culture
Community and Regeneration

These join the pre-existing routes of:

Research, Development and Innovation (RDI)
Energy Usage
Local Growth

As previously noted, streamlined routes may be made under section 10 of the Subsidy Control Act 2022 and enable public authorities to award subsidies without the requirement to assess them against the Subsidy Control Principles because they have been pre-assessed by the DBT as being compliant with the wider subsidy control regime. There is therefore no need to notify the Subsidy Advice Unit where a proposed grant is consistent with the terms of the designated streamlined route.

Arts and Culture

The Arts and Culture Streamlined Route has three categories contained within its scope, notably each containing their own limits, subsidy ratios, and eligibility criteria and conditions.

The guidance defines each of the categories as noted below:

Category 1 – Arts, Creativity and Culture: traditional and contemporary disciplines including visual arts, music, theatre, dance, literature, linguistic culture, and combined arts.

Category 2 – Screen: Film; television; digital media and video sharing; extended reality; and video games (note, additional conditions may apply for subsidies awarded in this category.)

Category 3 – Cultural Heritage: Museums; archives; historic sites; libraries; collections and artefacts; and intangible heritage.

Details of the eligible costs, subsidy ratios, and criteria can all be found in the guidance published by the DBT, though it should be noted that where the maximums are exceeded or the relevant criteria are not met, a public authority may still consider the application on its merits outside of this scheme by taking their own Subsidy Control Assessment.

The aim of this particular route is to provide an effective mechanism to generate investment in Arts and Culture, to drive economic growth and productivity in associated sectors.

Community and Regeneration

The Community and Regeneration Route is structured by two strands: the Community strand and the Regeneration strand.

The Community strand provides for the development of community infrastructure and seeks the delivery of more desirable community spaces. This strand also contains its own subcategories formulating specific criteria and certain subsidy limits:

Category 1 – Seeks to support feasibility of the project.

Category 2 – Supports the acquisition and/or renovation of existing community infrastructure, as well as the creation of new community infrastructure.

Category 3 – Supports the operational costs such as wages, business support, and training.

A subsidy may be awarded under each of these categories to a maximum of £3 million.

The stated aim of the Regeneration category is to create infrastructure that will drive place-based growth through investment in brownfield land and underused buildings. The intention is to increase the supply of sites ready for development, improve infrastructure, and repurpose buildings that will improve local productivity and economic growth.

Comments

Despite some of the respondents to the earlier consultation describing the streamlined routes as bureaucratic and restrictive, the expansion of these routes is hoped to enable wider access to available funding and expedite the process. Confusion can reign when public authorities consider the provision of subsidies for infrastructure projects and these streamlined routes at least provide some degree of certainty on the categories they cover.

One of the main aims of the recent updated guidance on the function of the Subsidy Advice Unit (SAU), was to alleviate the pressure on the SAU and enable it to properly focus on subsidies of a higher value with a potential to distort competition in the local or national economy. By introducing more streamlined routes this should further reduce the amount of bureaucracy involved in the application process and ensure that funding reaches the end users sooner.

If you would like to know more about how you can navigate the subsidy control regime, our team are well informed and can provide qualified legal advice on the Subsidy Control Act 2022. Please contact our team or your usual Shepherd and Wedderburn contact.

This article was co-authored by Trainee Angus MacVicar.

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