Applications are now open for the Department for Education’s School-based Nursery Capital Grant 2025-26
The Department for Education (DfE) has opened applications for the School-based Nursery (SBN) Capital Grant, a funding programme designed to help primary schools and maintained nursery schools expand or create new nursery places. Backed by £45 million, this phase of funding will support at least 300 new or expanded school-based nurseries for the 2026–27 academic year.
What is the DfE School-based Nursery Capital Grant?
Originally launched in September 2024, the SBN Capital Grant provides up to £150,000 capital funding for primary schools to create or expand nursery provision. The programme is part of the government’s strategy to increase early years capacity by repurposing surplus space in school buildings.
In phase 1, 300 school-based nurseries were approved, creating up to 6,000 new places in total. Phase 2 will extend funding to at least a further 300 schools, offering up to £150,000 in capital support. Unlike phase 1, schools are not required to use existing spare space, although it is still encouraged.
Phase 2: Focus on Disadvantaged Areas and Early Years Access
The new funding continues the aim of building nursery capacity in the sector but with an increased focus on supporting disadvantaged families access to early years provision.
This follows the release of the DfE’s ‘Giving Every Child the Best Start in Life’ strategy in July this year, which aims to improve child development and ensure that 75% of 5-year-olds in England have a good level of development by 2028. The expansion of the SBN Capital Grant is part of the strategy’s aim to address that children growing up in poverty or facing social challenges often lack access to high-quality early education, which can significantly impact their readiness for school and long-term outcomes.
Eligibility for the SBN Capital Grant
The grant is open to:
State-funded primary schools in England that already offer early education (such as a reception class) seeking to create or expand an SBN.
Maintained nursery schools in England looking to expand their current provision.
Earlier phase restriction: Schools that received grant funding in the first phase (2024–2025) are not eligible to apply again for 2025–2026. However, they may participate through local authorities in the Phase 3 process.
What can the SBN Capital Grant be used for?
Renovations, refurbishments, or refits of school areas into suitable nursery spaces - including any adaptations needed to meet SEND (Special Educational Needs and Disabilities) requirements.
Upgrades or alterations to essential building systems, such as heating, plumbing, fire alarms, and electrical systems.
Purchasing new physical assets – items like furniture or computer equipment - provided they meet the criteria for capital assets (i.e., they bring economic benefit and are of sufficient value to be depreciated over more than one financial year).
Enhancing outdoor spaces, such as playgrounds or improving the flow between indoor and outdoor areas, where part of nursery provision.
Fees for project team technical advisers and survey costs, when these are directly linked to setting up or expanding the nursery space.
How to Apply for the SBN Capital Grant
Application window: Online portal for submission opens on the 22 September 2025, with a deadline of 5 pm on 11 December 2025.
Those looking to apply for the grant can submit a register of interest from 22 September.
DFE webinar for schools and academies are scheduled for October (date TBC). It is advised those interested attend this.
It is recommended to login to the online application service well in advance of the deadline. The DfE suggests beginning to submit your application by the 13 November.
Deadline for new applicants to register for a DfE sign-in account (required to access the online application for grant queries service) is 1 December 2025.
Applicants will be notified in April 2026 with project aims to be operational by September 2026.
What’s Changed in the SBN Capital Grant Phase 2?
The assessment criteria have changed to reflect the focus on disadvantaged areas which will account for 50% of the overall scoring. Local need and value for money accounts for 20% and Ofsted key judgements is weighted at 10%.
Increased emphasis has been placed on the involvement of the local authority to ensure newly created places reflect local need. Applications require a completed local authority approval form before submitting their full application.
While it is encouraged for schools to use any existing spare space, it's not a requirement for this phase.
Future plans for phase 3 are also disclosed with up to £370 million pledged for the programme up to 2030. In phase 3 local authorities will be invited to develop multi-year funding proposals (2027–2030). The DfE will publish separate guidance to support this process in early 2026 and will engage with local authorities and schools in autumn 2025 to provide further details.
How can Surveyors to Education support your SBN Application
We successfully supported schools and academies in securing phase 1 funding and are ready to help many more in phase 2 and beyond. Our team includes surveyors, architects, M&E engineers and health and safety specialists who are all experienced in planning and delivering school nursery provision. Whether you need an initial feasibility discussion or support in preparing a strong, bid-ready proposal, we are here to guide you every step of the way.
Get in touch today to arrange a meeting or find out how we can help you secure the SBN Capital Grant on 0116 5070130 or email enquire@s2e.org.uk.
