An interview study of the financial support and subsidies provided to companies
When the Swedish business sector was hit by the COVID-19 pandemic in 2020, the Swedish government commissioned the Swedish Agency for Growth Policy Analysis to undertake a structured follow-up evaluation of the financial support and subsidies provided to companies.
The study is guided by the following three questions:
- How do companies perceive the public pandemic subsidies?
- How do companies perceive the application and administrative process for public pandemic subsidies?
- How do companies perceive the management of these subsidies?
The main findings of the study are as follows:
- aid should have been better adapted to the sector;
- the application process should have been clearer and more transparent;
- the payment of aid should have been quicker, with better contact channels to authorities, especially to the Swedish Agency for Economic and Regional Growth.
There is a need for industry-specific aid adaptation
Respondents in the study were grateful for the availability of different types of subsidies during the pandemic. This was particularly true of the short-time work allowance, which many respondents found useful, and which helped them retain employees.
However, there were also criticisms regarding the support. While it worked well for the companies that were able to plan and schedule their activities according to the structure of the subsidies, it did not work as well for businesses with staff working on an hourly basis, such as those in the restaurant, service, taxi, and transport sectors.
There is also a critique of the way in which the criteria for support were interpreted by the responsible authorities, such as in the case of reconversion aid. Some respondents felt that criteria could not be met because certain sector-specific costs were not allowed to be included. There is also criticism that aid aimed at small businesses was launched too late and made it difficult for them to cope financially. The industry associations agree with these criticisms.
Faster and clearer application processes are requested
In general, it was administratively burdensome for some companies to come to grips with application processes and apply for support, regardless of the form of the requested subsidy. Speed and clarity varied between authorities, depending on which authority administered the subsidies. Most respondents were very satisfied with the Swedish Tax Agency's handling of the support, as they had a clear application process and good feedback from the agency's administrators. Industry organisations share this view.
On the other hand, the Swedish Agency for Economic and Regional Growth received a lot of criticism, even though companies' experiences at the beginning of the pandemic were positive, as the agency was quick to make pay outs. This soon turned into criticism from companies, who cited a lack of contact and difficulties following up on their cases.
This meant, for example, that important information did not reach companies in connection with errors or appeals, which caused the application process to be halted without the company understanding why. The industry associations share this view.
There is also criticism of subsidies directed to the cultural sector, where decisions were perceived as arbitrary with a lack of transparency in the case process. On the other hand, companies highlighted the positive aspect that the application process itself was simpler than it had been for other grants they had applied for.
Faster payments and better contacts requested
The perception of speed and contacts varies among enterprises, depending on which authority administered the aid. The Swedish Tax Agency is largely rated highly, while the Swedish Agency for Economic and Regional Growth is particularly criticised for late payments and difficulties contacting the agency.
There is also frustration with the way the Swedish Agency for Economic and Regional Growth's administrators could not comment on specific applications, and it was difficult for companies to obtain detailed information on their individual case.
Industry associations also criticise the long processing times and believe that it would have been better to approve the aid first, and then carry out ex-post controls.