New streamlined subsidy schemes announced for arts and culture, and community and regeneration: What are the key requirements and benefits and how can public authorities rely on them for future use?

What has happened?

The Department for Business and Trade has laid before Parliament two additional Streamlined Subsidy Schemes covering (i) Arts and Culture; and (ii) Community and Regeneration. In both cases separate guidance documents have also simultaneously been published. This development expands the range of pre-existing Streamlined Subsidy Schemes (otherwise known as “Streamlined Routes”) from three to five, and effectively extending coverage to new sectors of the economy. 

The new Streamlined Routes provide public authorities with an alternative means by which to satisfy themselves of subsidy exemption compliance for certain awards within the specific scopes set out.  In this way a Streamlined Route offers an alternative to using the Principles.  One of the advantages of the Principles is their flexibility (which for more difficult cases is especially important), but equally this means they are necessarily imprecise.  In practice this can mean more work for less legal certainty, which for a more “routine” subsidy award or awards, may not be very helpful or add particular value.  The intention of a Streamlined Route therefore, if done well, is to create a simpler set of terms and conditions to satisfy, provided the subsidy stays within the strict parameters set. Those parameters, which include maximum subsidy value per different intervention, are set in ways the Government considers as creating less risk of creating a serious distortion of competition.    

What are Streamlined Subsidy Schemes?

Streamlined Subsidy Schemes are compliant subsidy exemption routes that allow public authorities to award certain subsidies, provided they satisfy all the relevant criteria set out therein, without conducting their own assessment against the Principles.  Awards made under a Streamlined Subsidy Scheme are also not subject to mandatory review by the CMA’s Subsidy Advice unit before they may be awarded.

Since the introduction of the Act, the UK Government has created three Streamlined Subsidy Schemes. These are for:

• Research, Development and Innovation (SC10780) – covering subsidies for feasibility studies, industrial research and experimental development;
• Energy usage (SC10781) – enabling support for energy reductions, green heat networks or green skills training; and
• Local Growth (SC10782) – providing business development support for SMEs through targeted subsidies.

Streamlined Subsidy Schemes are sometimes considered the UK equivalent of “Block Exemption Regulations” in EU Competition and State aid law.  Those with a familiarity with EU State aid law will recall that one of the key instruments of that regime is the so-called “GBER” (General Block Exemption Regulation) which provides a very wide (50+) list of types of subsidy that can be provided within the law and the respective terms and conditions for doing so in each case.

When the new UK regime under the Act was enacted, it contained similar provisions to State aid law for judging what is a subsidy (and therefore what needs an exemption route to be safely given) but very different routes for determining suitable exemption routes.  The Act contains the default exemption route of the Principles but also includes an ability for the UK Government to set individual Streamlined Routes and in so doing set specific conditions for specific types of intervention within pre-set parameters.

Streamlined Routes, when adopted, may be used by any public authority across the UK, provided that the proposed subsidy to be awarded meets all the terms of the relevant Streamlined Route. In this way they are not to be confused with individual subsidy schemes adopted by specific authorities, for which the Principles need to be applied by those authorities when creating those schemes.

Streamlined Routes are also not mandatory. They create an option for a different subsidy exemption route when a proposed subsidy fits the relevant criteria. Public authorities may still use alternative exemption routes available to them in any given case, if they prefer.

To date the use of Streamlined Routes has been limited, with the Government previously stating it was not the intention to recreate a UK version of GBER.  The Streamlined Routes that were first enacted have been criticised for having maximum subsidy thresholds that limited their use, ie. the maximum limits were too low to be of as much practical value as was hoped. 

For some time there has been a clamour for more Streamlined Routes, particularly to allow authorities not to have to deploy the Principles so often for more routine interventions that were not perceived to present any particular threat to competition.  The case for Arts and Culture was possibly the loudest in this vein, particularly since this area had previously been one of the area’s most generously treated within GBER.

When are the new Streamlined Subsidy Schemes available to use?

Straight away, for the time being at least. The Government laid the two new Streamlined Routes before Parliament on 12 January 2026. Under the Act, a Streamlined Subsidy Scheme must remain before Parliament for 40 days, giving Parliament until 21 February 2026 to pass a resolution not to approve it. If no such resolution is made, the Streamlined Routes will enter into law from 21 February 2026. If Parliament did pass a resolution not to approve the new Streamlined Routes, any subsidies already awarded in full compliance prior to the Scheme’s annulment would remain valid, but no further subsidies could be granted under that Scheme thereafter.

A new Streamlined Route may also (at least in theory) be challenged before the Competition Appeal Tribunal, although it is difficult to envisage any third parties having an active interest in doing so.

What does the Arts and Culture Streamlined Subsidy Scheme cover?

There are three main categories of intervention covered:

• Arts, Creativity and Culture: traditional and contemporary disciplines including visual arts, music, theatre, dance, literature, linguistic culture and combined arts);
• Screen: film, TV, digital media and video sharing, extended reality (XR) and video games; and
• Cultural heritage: museums, archives, historic sites (including buildings, gardens, landscapes, monuments and archaeological sites), libraries, collections and artefacts, and intangible heritage (living, traditional and folkloric heritage and linguistic culture).

The above is deliberately broad, and it is difficult to think of anything in particular which could normally be said to be within the Arts and Culture space that could not be included within the scope above. 

Within each of the categories above the Streamlined Route then goes on to allow subsidy cover for three different types of projects or rather “eligible costs”, namely:

• Revenue costs, ie. funding ongoing activities including running costs, subsidising tickets to increase public access and funding other general operating costs;
• Capital expenditure costs, ie. funding investment in assets, buildings and premises, access and core infrastructure; and
• Project costs, ie. one-off time limited creative or cultural activity, touring (nationally or internationally), organisational change projects, digital skills or improvements, R&D and cultural regeneration and “placemaking” such as supporting new enterprises in the sector.

Accordingly, the breadth of what sort of activities can be supported under the Streamlined Route is also very wide and it is difficult to think of activities that arts and culture enterprises engage in that cannot be fitted into the above. However, the Streamlined Route does contain the usual exclusions and prohibitions set out in the Act generally. For example, it cannot be used to restructure an ailing or insolvent enterprise in the sector.

Having established the three categories of intervention and the three types of costs that may be supported, the Streamlined Route then goes on to set out a series of maximum subsidy amounts and maximum subsidy ratios (ie. subsidy to total costs) that may be supported.  There is also a more generous allowance to small and medium sized enterprises (SMEs) as opposed to large, noting that categorisation as an SME is per the (UK) Companies Act and not EU law.  This is summarised in the following table:

Other key requirements include that the maximum amount thresholds above are per three financial years and that subsidies are to be capped at the maximum amount or maximum intensity, whichever is the lower. The Streamlined Route also includes a direction to the effect that the awarding authorities should always seek to give the lowest subsidy amount for achieving their objective (NB. this last point being strongly reminiscent of Subsidy Control Principle B). 

Lastly, the Streamlined Route requires that the funding is not paid up-front, and that payments be made following demonstration of need. While this is not explained further in the published guidance, we would typically expect this to require phased payments under a grant funding agreement whereby claims would be submitted at specified intervals with proof of defrayal of eligible costs.

What does the Community and Regeneration Streamlined Subsidy Scheme cover?

This Scheme has two so-called “strands”:

• Community, ie. supporting stronger and more cohesive communities by investment in community infrastructure, being physical spaces and facilities providing communities with services and resources to thrive; and
• Regeneration, ie. investment to drive economic growth by repurposing brownfield land and underused buildings, creating new physical infrastructure to attract new business and jobs and place-based growth.

Thereafter the types of costs and activities within each strand are permitted to be subsidised as follows (using similar terminology to Arts and Culture outlined above):

Eligible costs in the Regeneration strand include all of the typical capital expenditure encountered in typical regeneration projects including acquisition of brownfield and and/or buildings, site preparation including demolition and remediation, construction of infrastructure including roads and utilities, delivery of new buildings (including housing), and professional fees and finance costs explicitly linked to the above. One caveat is that in the case of standalone acquisitions the regeneration project must commence within three years.

The above is comprehensive and perhaps unsurprisingly is broadly similar to the configurations used in certain individual subsidy schemes adopted by the Ministry of Housing, Communities and Local Government (MHCLG) such as the Levelling Up Fund (LUF) Subsidy Scheme, which similarly endorsed regeneration projects subject to reasonable viability gap demonstration.  Similar routes have also been used by other public authorities such as Greater Manchester Combined Authority in adopting its subsidy scheme for brownfield land housing projects. 

It is noteworthy that the Regeneration strand authorises maximum subsidy interventions up to an amount of £12m.  This is more than the original threshold of £10m for mandatory referrals to the CMA but less than half of the newly raised threshold of £25m (since August 2025), hence there will remain a substantial number of regeneration projects that go over the £12m threshold, and so for which the Streamlined Route cannot be used.  This will also arise because the Streamlined Route includes cumulation provisions which require public authorities to take into account any previous subsidy to the same beneficiary and project within the current and past two financial years, such that even if the subsidy under analysis would be less than £12m, if it would take the cumulative subsidy over £12m then the Streamlined Route is unavailable. 

Common features of both Streamlined Routes

In both cases, there are cumulation provisions which mean that if the subsidies under analysis take the total over the maximum threshold, then the Streamlined Routes cannot be used. 

Both Streamlined Routes contain provisions requiring public authorities to have obtained minimum advance information from beneficiaries of subsidy including locations, start and end dates and expected outcomes (as would normally be expected in typical grant applications).  Both Streamlined Routes also require that subsidies are not given to projects that have already started, or that any start not happen before the public authority has expressly authorised the same. While the term “starting” a project is not elaborated upon, this is normally taken to exclude preparatory costs, and in the case of Community and Regeneration projects if the primary construction contract has already been let then the project is ineligible. 

In both Streamlined Routes the most important point to remember however is that for a subsidy to receive full and complete cover, it must be seen to observe all relevant criteria, ie. all general conditions and all specific conditions depending on the category or strand relied on. A particular subsidy cannot selectively rely only on the conditions that it suits and conveniently ignore anything which it does not.  Put another way, if via a formal challenge a subsidy could be shown not to comply with one or more of the relevant criteria, the use of the Streamlined Route would be deficient.  Accordingly, when seeking to use a Streamlined Route a public authority needs to be satisfied of all relevant considerations and if an issue of apparent non-compliance is insurmountable, then use another exemption route instead, eg. the Principles. 

The different guidance notes do also remind interested parties that subsidies given under Streamlined Routes but over a value of £100k still need to be the subject of notices in the national subsidy database, and in such cases the notices would state that the subsidies had been given under the Streamlined Route relied on.  Challenges remain possible, with the scope of the challenge being limited to compliance with the Streamlined Route in question. 

Public authorities seeking to use a Streamlined Route must therefore satisfy themselves of compliance with all relevant terms and conditions.  This is a not inconsiderable task and while it lends itself to checklists and can be ticked off far more precisely than a Principles assessment, it is not to be underestimated and must be thorough if it is to be effective.    

Commentary

While some authorities will no doubt lament that the maximum subsidy thresholds allowed in both Streamlined Routes are not higher (perhaps especially for Regeneration), both new Streamlined Routes are to be greatly welcomed into the “options list” for management of subsidies in the respective areas, and will surely aid legal certainty and lessen workloads to a degree for a number of subsidy awards. 

What the two Streamlined Routes provide is a different and undoubtedly easier set of criteria to check and to satisfy than the Principles.  These criteria are rigid and will normally either be satisfied or not, but in this way they are more certain and so this offers an important difference to the very subjective (and some would consider impenetrable) consideration of the Principles.  How easy or not it is to demonstrate satisfaction of the Principles is shortly to be examined by the Competition Appeals Tribunal in the case of Bristol Airport v Welsh Ministers (regarding subsidies to Cardiff Airport), which will be compulsive viewing, but the general view is that from any perspective this is normally a harder and more time consuming task than to address the conditions of Streamlined Routes.  Perhaps the single biggest benefit of using the Streamlined Routes in this way is not having to address Subsidy Control Principle F.  This is the one that addresses minimising negative effects on competition, and which many public authorities would consider by far the hardest of the Principles to pin down reliably. 

Overall, we therefore consider the two new Streamlined Routes to be very helpful and a bonus to effective and efficient practice in this space. We anticipate that the arrival of these two will greatly increase the use of Streamlined Routes as against what has gone before and that both will be used regularly and effectively.  No doubt at some point there will be a challenge to one authority’s invoking of one of the Streamlined Routes, and when that case comes it is likely to examine how thoroughly the authority checked all relevant requirements.  For this reason, it will be important to have careful audit trails for all issues whenever deploying, and never to forget to publish the relevant notices in the national subsidy database after award.