PIF Eligibility: State Aid

To secure a free place on one of the CPD sessions available through the Provider Improvement Fund (PIF), one eligibility criteria you must meet is that the organisation you work for must not have received more than £187K in State Aid over the last three years.

This is because the PIF programme is funded through residual European Social Funding, which is still subject to pre-Brexit EU State Aid rules.

Before you attend a PIF CPD session, you must complete a Training Provider De Minimis Declaration Form, which confirms how much State Aid your organisation has received, if any.

A member of your Senior Leadership Team or the person responsible for finances in your organisation is probably best placed to complete the form, as they are likely to have the necessary information.

At the bottom of this article, you will find some examples of what constitutes State Aid, and what doesn’t.

We would ask you gratefully to complete and return the form as fully as possible.

What is State Aid?

“State aid is any advantage granted by public authorities through state resources on a selective basis to any organisations that could potentially distort competition and trade in the European Union (EU).

The definition of state aid is expansive because ‘an advantage’ can take many forms. It is anything which an “undertaking” (ie an organisation engaged in economic activity) could not get on the open market.” (source: www.gov.uk/guidance/state-aid)

To ascertain whether (financial) assistance you have received is considered State Aid, you must ask the following questions. If the answer is yes to all questions, then the assistance is very likely to be classed as State Aid.

Question 1: Is the assistance granted by the state or through state resources?
In other words, has the assistance been given to you by any public or private body controlled by local or national Government? Or via a means that has an impact on the state budget, or where the state has significant control.

Question 2: Does the assistance give an advantage to you over other organisations?

Question 3: Does the assistance distort or have the potential to distort competition?

Question 4: Does the assistance affect trade between EU Member States?
This applies, even if your organisation doesn’t export to other EU Markets

Examples of State Aid

  • tax breaks, including enhanced capital allowances
  • the use or sale of a state asset for free or at less than market price
  • Apprenticeship Levy transferred from one employer to another
  • Lottery Funding
  • direct state grants or subsidies, such as ‘rescue’ aid or investments made by local or regional government; for example, Skills Capital Fund
  • tax or other social security exemptions;
  • loans at preferential interest rates;
  • guarantees or indemnities on favourable terms;
  • preferential grants or loans;
  • disposal of land or buildings at less than full market value;
  • debt write-offs;
  • waiving of profits or other returns on public funds;
  • export assistance;
  • ‘sweeteners’ to attract investment into a region;
  • ‘forgiveness’ of liabilities (for example, employers’ social security payments or licence fees).
  • The financial support that covers the cost of you attending any Provider Improvement Fund CPD session – GMLPF can provide you with this information if you have previously attended a PIF session.

What is NOT State Aid

  • The Covid Job Retention grant is not considered state aid because it is available to all businesses
  • Covid business grants
  • Provider funding for apprenticeships, traineeships, AEB etc is not considered State Aid as this is regarded as money given to, and subsequently distributed by, the business. This is covered by what is referred to as the flow through principle

However, as a learning provider, you may have received funding from sources or funding programmes such as the Mayoral Combined Authority, the Local Enterprise Partnership or Capital Programmes such as Skills Capital Fund or Strategic Investment Fund. This does not necessarily mean that the support makes you ineligible for support under this programme. Rather it is the case that you may have sought or been given legal advice confirming that the support is covered by what is called a bloc exemption. It therefore doesn’t count.

Our advice to you is to identify any funding received and we will review it and let you know if it is likely to count towards the £187,000 threshold. We will also let you know how support you have received via the programme to enable you to complete and update the De Minimis form on an ongoing basis

The above information is intended as a guide only. If you are unsure about whether your organisation has received State Aid, please seek expert advice. You can contact [email protected] in the first instance who may be able to clarify your position.