A Newry woman said she felt “misled” by communications from her local council after it asked her to return flood relief money it says was paid to her in error.

Loretta Gallagher, who owns a textile art and gift shop, applied for and received £7,500 from Newry, Morne and Down District Council.

But the council has since told her she is not eligible for the scheme and asked her to return the money.

Ms Gallagher was sent an invoice requesting a refund, but was later sent an email saying the invoice had been sent in error.

A council spokesman said it “does not comment on individual business application matters”.

In October 2023, heavy rain caused the Newry Canal to burst its banks, leading to severe flooding in parts of the city.

Ms. Gallagher’s store is located on the first floor of a building in one of the hardest hit areas, Sugar Island.

“The flooding was about five feet, six feet in front of this building … it was under water for a week,” she said.

Ms Gallagher said she was forced to close her business for seven months.

“It was like an open construction site, it was dripping wet, there was no electricity, there was no water in most of it, there were no toilets, there were lumps falling out of the walls because of the dampness.”

In November, Ms Gallagher applied for a grant open to businesses affected by the flood.

“We’ve had the council’s environmental health officer assess the building and the business,” she said.

“He got through it probably because he came back and then thankfully I got the £7,500 because I was at the end of my rope at that stage.”

Ms Gallagher said it was in the new year when she received a phone call from the council saying a mistake had been made and the grant had to be returned.

She said she had already spent the money by then.

“Trying to get this building up… even helping the guys downstairs as well… was trying to keep body and soul together when the whole income suddenly dries up overnight. .

“I made the decision (not to return the money) because I knew I deserved it, I knew I was affected, I knew I was affected.”

Several months passed and Ms Gallagher heard nothing from the council.

And then “a few days before the anniversary of the flood I received an invoice asking for the money in 14 days”.

Ms Gallagher said she “couldn’t pay” the money and it would “terminate” her business.

On Wednesday evening, Ms Gallagher received another email from the council to say the invoice received “should have been held pending further discussions with the council”.

She said she “didn’t know what to make” of it and had “no idea” what would happen next.

In the immediate aftermath of floods, businesses could apply for rate reductions and grants of up to £7,500.

The eligibility criteria for this scheme to which Loretta Gallagher applied were as follows:

• The business must have been ordinarily occupied and transacted on the date of the flood incident.
• The relevant district council confirmed that the business was flooded.
• The business plans to reopen in due course.
• The business had no insurance to cover flood damage.
• The business must be an SME and trade as such.
• The business must be responsible for immediate cleanup costs and work to restore business.
• Public sector properties were excluded.

In February, the Department for the Economy and two local councils opened Enhanced flood support schemeoffering up to £100,000 to each eligible company.

Confused by Ms Gallagher’s plight is Eamonn Connolly, managing director of Newry Business Improvement District.

“We don’t really know what’s going on.

“Lorretta was fundamentally affected by the flooding, that’s undeniable,” he said.

“Mistakes can happen, and if technically Loretta didn’t qualify, there should have been a conversation to explain that and commit.

“Unfortunately, letters were sent saying she wasn’t affected which added insult to injury and in the meantime there was a void and this Damocles sword of owing money and being prosecuted for it it remains hanging over her 12 months later, which she has not done again. it was good for her mental health.”