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Some restaurants struggle to repay Covid rescue support

Finland wants more than 1,000 restaurants to pay back Covid relief grants.

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Fast food restaurants fared better in the pandemic than traditional eateries. Image: Mostphotos
  • Yle News

The state wants around 1,100 bars and restaurants in Finland to pay back Covid support. The grants aimed to offset losses that occurred when restrictions shuttered bars and eateries last spring.

The agency charged with doling out money, Finland's Development and Administrative Services Centre, or Keha keskus, transferred Covid rescue funds to some 7,800 companies in the restaurant sector in the spring of 2020.

The organisation later realised it overpaid 1,100 of these businesses by some 15-25 percent.

Excess aid amounts mostly range between 1,000 and 10,000 euros, though the rescue programme is asking one restaurant business to pay back 200,000 euros.

Some 500 businesses have already repaid excess grants. But restaurant industry lobby MaRa said the other 500 can't use an empty coffer pay back subsidies.

The restaurants in question did not separately apply for the grants, but received them automatically soon after the Ministry of Economic Affairs and Employment decided that Keha was to manage subsidy payments to businesses whose sales dropped by 75 percent.

"In hindsight we can establish that businesses in the restaurant sector managed better than we had expected," said Keha's Pauliina Smolander, pointing to fast food and takeaway restaurants.

However 100 to 150 of these businesses are cash-strapped, meaning any money owed will go straight into debt collection, according to Smolander.

"These companies have unpaid bills, rent and other expenses. All payments are difficult for them right now," said Timo Lappi, who heads restaurant industry lobby MaRa.

Smolander said that while it's unfortunate Keha overpaid some businesses, she emphasised that the programme got the money out quickly, enabling restaurants to stay on top of salaries.

"The situation was catastrophic at the time. Restaurants were closed and we had to make sure they had support. We were under pressure to get the money out quickly," she said.

Companies that were overpaid by 100 euros or less will not be asked to return funds.