Finding funding
Introduction
When we are lost in the woods, the sight of a signpost is a great matter.
Funding for Local Visitor Economy Partnerships (LVEPs) can be sourced from: central government, local government, arms-length bodies of government (ALBs), international funding programmes, foundations and charities.
Creating a pipeline of funding opportunities involves putting aside time to engage with funders, creating alerts from funding organisations and utilising your network contacts to understand what might be on the horizon. A proactive approach will help to prepare for, or even influence, the scope of future funds.
LVEPs looking for funding now and over the next 6 to 12 months can check the opportunities database (XLSX, 135 KB). It is searchable and contains a guide on how to use it. Additional worksheets provide information on main funding sources, future opportunities to look out for and additional funding search services, including those that are relevant for SMEs.
To access this document, please contact [email protected] for the password.
Note: This database was last updated on 29 August 2023. Please check the website every 3 to 4 months for new updates.
Of particular note is a new government service, Find a Grant, which brings together all government departments and public authorities’ grants schemes in one place. LVEPs are recommended to identify a person in the organisation to register online to check the database regularly and to receive automatic alerts of new opportunities relevant to their organisations. Some opportunities will be available only to certain types of LVEPs, such as those constituted as Community Interest Companies.
Types of funding
The diagram below summarises the important functions that need to be carried out to achieve successfully the aims and objectives of destination management and are usually included in the role and remit of an LVEP. They can be broadly divided into core functions and enabling functions that support effective management and development of a destination.
| LVEPs’ Activities | Examples of funding sources |
|---|---|
| These functions are most likely to be funded through public investment at the local level and/or a range of income generating activities. For example:
These functions are most likely to be funded through project funding. For example:
|
The most likely source of external funding for LVEPs is local authorities. The amount of funding varies widely and often depends on whether or not the LVEP is embedded in the authority or an external organisation. Those that are embedded are most likely to have overheads and staffing covered out of the authority’s core budget. Those that are external may enjoy strong support but often the funding is not enough to cover the basics.
LVEPs that are internal to a local authority will need to articulate, through business or service planning, how they are helping to deliver the objectives of the authority in order to maintain their budget allocation. LVEPs that are external will be asked to apply, or provide a business case, to secure investment and may have to develop a service level agreement. A good destination management plan that is supported by the local authority is an essential tool for both embedded and external LVEPs to demonstrate the value that they deliver and provide reasons why they should be funded.
However, funding is not statutory for the functions that an LVEP routinely carries out and is therefore not guaranteed. Even high performing LVEPs will not necessarily secure funding if the local authority does not prioritise visitor economy or if budget pressures are severe enough. Statutory services will always take precedence. Many LVEPs have to rely on a variety of sources and income activity to fund part or the whole of their operation.
In the future LVEPs may be able to access central government funding through a new mechanism, Destination Development Partnerships (DDPs). The concept brings together a cluster of LVEPs to agree how the visitor economy in their area should be developed. Central government funding, administered by VisitEngland in the form of a non-competitive (uncompeted) grant, is then provided to the DDP to deliver agreed priorities. The concept is being piloted in North East England currently (as of March 2023). It is not yet clear whether DDP funding will become a regular source of funding for LVEPs.
Project and programme funding
The most likely source of funding for ‘management/development functions’ are grants. Those accessible to LVEPs are most likely to be provided by central government through an Arm’s Length Body (ALB) and possibly a combined authority (although this is too early to know at the time of writing) or another development body such as a Local Economic Partnership (LEP). They are less likely to secure grants from local public authorities, foundations and charities because the beneficiaries are usually private sector businesses or individuals.
Government departments and ALBs most relevant to LVEPs:
| Government Departments most relevant to LVEPs and their funds | Most relevant ALBs and examples of the funds they have administered |
|---|---|
Innovate UK – Innovation competitions UKRI – Research and Innovation funding | |
VisitBritain/VisitEngland – Business Events Growth Programme; Discover England Fund; GREAT Gateway Innovation Fund; Tourism Growth Funds Arts Council England – Culture Recovery Fund National Lottery Heritage Fund– Culture Recovery Fund; National Lottery Community Fund Historic England – Culture Recovery Fund; Historic England Grant Schemes BFI– Culture Recovery Fund NHMF– National Heritage Memorial Fund | |
DEFRA – Department for Environment, Food and Rural Affairs Farming in Protected Landscapes Fund for National Parks Farming in Protected Landscape Scheme | The National Forest Company – National Forest Arts Grant; Small Grants Fund; Sustainable Tourism Grants; Woodland Economy Grants. |
DLUHC – Department for Levelling Up, Housing & Communities | |
| Department for Transport |
Note: See more details in the ‘Key Funding Sources’ tab of the LVEPs Opportunities database and resources (XLSX, 113KB) (XLSX, 135 KB).
Types of grants
When grant money originates from central government, it falls into three grant categories: formula grants, grant-in aidand general grants. Of these three, the most relevant type for LVEPs are general grants.
General grants are a relatively flexible means of funding activities for the public good/in support of government departmental policy. The department provides the funds and remains at arm’s length to the recipient whilst maintaining performance management and financial control over the use of the grant funds.
General grants are normally given to fund new projects or programmes rather than existing activity or to cover the core costs of running organisations.
General grants can be subdivided into:
- Competitive (competed) awards, open to full competition with no restrictions on who can apply;
- Close competition awards where a select range of potential applicants can apply, sometimes called challenge funds;
- Direct awards that are non-competitive (un-competed) to address a specific policy objective made upon ministerial direction; and,
- Section 31 (s.31) grants which are departmental and awarded to local authorities for specific expenditure.
Example types of grants:
| Grant type | Illustrative example |
|---|---|
| Competitive grants | Innovate UK SMART grants, open to any company that can meet the requirements of the fund. |
| Close competition grants | Discover England Fund, specifies the types of organisations able to apply e.g. destination management organisations (in future moving to LVEPs or others e.g. DMCs). |
| Direct awards | Cornwall G7 Summit Legacy Media Plan. |
| Section 31 grants | Omicron Hospitality and Leisure Grants to support businesses through the COVID-19 pandemic. |
According to government guidance, competitive grants are the default type for all general grants. This type of general grant is the one most frequently available to LVEPs.
Sourcing funds through partners
A significant amount of funding used to support the UK visitor economy is not directly accessible to LVEPs. It is provided to organisations that have remits for specific activities or sectors which benefit the visitor economy directly, tangentially or in a generic way. The type of funding available is usually competitive grants and sometimes grant-in-aid.
LVEPs that have well developed relationships with a wide range of organisations in their locality may be able to work with partners to secure funds and potentially receive a slice of the investment as a delivery partner.
The kinds of help that LVEPs can provide to partners at application stage include:
- Evidence for applications and bids;
- Mechanisms to gather the support of private sector partners;
- Endorsement and testimonial material;
- Knowledge about the visitor economy.
Local authorities are often lead bidders for competitive funds that are not open to LVEPs but they usually need a broad coalition of partners to secure the funding. LVEPs can be valuable partners because of their knowledge of the visitor economy in their area and their ability to support the tourism industry.
Examples of funding available to LVEP partners
| Sponsoring department | Recipient | Visitor economy benefit |
|---|---|---|
| Department for the Environment, Food & Rural Affairs (DEFRA) | National Parks and Areas of Outstanding Natural Beauty (AONBs) | Development of rural tourism. |
| Department for Business & Trade (DBT) | Training providers | Skills training for businesses including visitor economy businesses. |
| Department for Culture, Media & Sport (DCMS) | National portfolio of cultural organisations | Development of cultural offer e.g. events (via ACE). |
| Department for Levelling Up, Housing & Communities (DLUHC) | Local authorities, colleges, universities, leisure trusts, cultural trusts etc | Improvement to the visitor experience e.g. public realm, leisure facilities, skills e.g. Towns Fund. |
New regime for grant funding by public authorities
Following the withdrawal of the United Kingdom from the European Union, there is a new name for state aid – subsidy control regime – and new language to describe some of its characteristics. It has been brought in by the Subsidy Control Act 2022. Comprehensive information about the regime is available online here.
Two funding routes are highlighted here because they are the most likely to be used by VisitBritain and VisitEngland:
- Minimal Financial Assistance (formerly, de minimis) which enables an enterprise (LVEP) to receive up to £315,000 in the form of subsidies over the current and previous two financial years, on a rolling basis.
- Grant awards made under schemes in excess of £100,000.
The grant scheme prospectus will set out the subsidy control basis upon which the funding-provider is offering the grant. Grant recipients will not be able to decide on the basis on which they wish to receive the grant, it will be determined by the funder.
Transparency is fundamental to the new subsidy control regime. Public authorities must upload details of the subsidies (that is, grants) and schemes to the Government’s Department for Business and Trade Subsidies Database. They must provide sufficient information regarding a subsidy so that interested parties can determine whether or not they want to challenge it. Failure to upload details of a subsidy to the database will mean that the UK public authority has not discharged their transparency duties under the Subsidy Control Act 2022.
The following subsidies must be uploaded to the UK Subsidies Database:
- All subsidy schemes;
- All standalone subsidies;
- Subsidy awards made under schemes in excess of £100,000;
- Minimal Financial Assistance (MFA)/Services of Public Economic Interest (SPEI)/SPEI Assistance awards in excess of £100,000.
How a subsidy may be challenged
A public authority’s decision to give a subsidy can be challenged and reviewed by the courts. This could be on subsidy control grounds or general public law grounds. Only the decision to give a standalone subsidy or make a scheme can be challenged.
A challenge can be made by an interested party to the Competition Appeal Tribunal (CAT) within the 30-day limitation period. Key points to note are that:
- An interested party is defined as anyone whose interests may be affected by a subsidy or scheme.
- Challenge must be within one month of a subsidy being uploaded to the Subsidies Database. Interested parties can also request further information about the subsidy.
- An interested party must send an ‘application for review’ to the Competition Appeal Tribunal (CAT).
The Competition Appeal Tribunal (CAT) is an expert tribunal that will hear subsidy control cases. The CAT will only review whether a subsidy decision was lawful, not its merits or effectiveness. The CAT may also award the same remedies as the general courts as well as ordering recovery of all or part of a non-compliant subsidy.
Deciding what to apply for
When funds are tight it is tempting to apply for any available funding, but it is better to apply your time and resources to opportunities that meet your needs and which you have a good chance of securing. When an opportunity appears ask yourself a short set of questions to help decide if it meets a need and if you are in a position to apply. If there are too many negatives, take a step back and consider whether this is the right opportunity for you before committing time and effort to an application.
| Checklist 1 – Is thisopportunity for us? | Yes | No | |
|---|---|---|---|
| 1 | Is the fund relevant to the visitor economy? Check if the funding has been awarded to the visitor economy sector before, the percentage of applicants that have been successful to date and the size of the fund overall. It will give a sense of how accessible it might be and the chances of success. | ||
| 2 | What kind of funding is needed and does the fund provide it? e.g. core, project, capital, revenue, seed funding or a mixture of several types. | ||
| 3 | What is the focus of the fund, what will it pay for? Does that fit with the purpose for which it is needed? Do the objectives of the fund fit with those of the organisation or destination? | ||
| 4 | Is the organisation eligible to apply? The funding may be directed to not-for-profit companies, private sector companies or public sector organisations or require a set of partners to apply together. | ||
| 5 | Are there any pre-qualifying criteria that need to be met? Examples could be time in business, level of annual turnover, insurance levels, ability to secure ‘match funding’. | ||
| 6 | What is the maximum amount of funding per applicant, and will it meet your need? If not, where will other funds come from? | ||
| 7 | Are the time and resources needed to produce an application available, and available now? If not, can they be found, or can other activity be suspended to free up resources temporarily? | ||
| 8 | Is the relevant expertise and experience to deliver that activity present in the organisation/partnership? The funder will want to ensure their funds are being used well. Applicants with the right expertise and experience are more likely to receive investment. |
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