School Based Nursery Capital Grant – Phase 2

Oct 2, 2025

3 min read

Updated: Sep 7

Last year, the Department for Education (DfE) announced the rollout of the School Based Nursery Capital Grant. This funding opportunity allows primary schools in England to apply for up to £150,000 to develop and enhance their on-site nursery provision. Due to the success of this initiative, the DfE has now announced phase 2. This blog will break down the key points, from what happened in phase 1 to who can apply for phase 2. Read more about Phase 1 of the School Based Nursery Capital Grant here.

children playing on a timber early years climbing frame with red slide — Bishop's Tachbrook Pre-School is a school-based nursery that we worked with to transform their outdoor space - read about this project here.

The Impact of the School Based Nursery Capital Grant: Phase 1

Phase 1 of the School Based Nursery Capital Grant (for the academic year 2024 to 2025) demonstrated that well-designed capital investment can significantly expand nursery provisions within local communities. Here are some key outcomes from phase 1:

300 schools received funding to create up to 6,000 new nursery places, primarily in the North and the Midlands.
Total successful funding bids amounted to approximately £37 million, with many bids ranging between £100,000 and £150,000.
Of the successful bids, around 40% were for creating brand new nursery facilities, while the remaining 60% aimed to expand existing provisions.

Phase 2: Who Can Apply and What For

State-funded primary-phase schools and maintained nursery schools are eligible to apply for this funding, provided they meet certain criteria. These include:

Endorsement from the local authority through an approval form.
Approval from the landlord or freehold landowner for the proposed changes.
Alignment of the proposal with the Department for Education assessment criteria. This includes demonstrating evidence of demand, viability, value for money, sustainability, and benefits to disadvantaged children.

It is important to note that institutions that had a successful bid in phase 1 cannot apply for phase 2.

The School Based Nursery Capital Grant is strictly for capital expenditure. This funding is intended for one-off investments or upgrades that deliver long-term infrastructure benefits rather than ongoing running costs for the academic year 2026-2027. Eligible expenditures include:

Converting existing space within the school’s footprint into nursery classrooms.
Upgrading services in the building, such as heating, lighting, and plumbing.
Installing or upgrading windows, doors, and accessibility features directly connected to the nursery facility.
Developing outdoor spaces for children to use for learning and play.

All applications, along with supporting documents, must be submitted via the online portal by 5 PM on Thursday 11th December.

Benefits of Nursery Expansion

Expanding nursery provisions in primary schools has numerous benefits. It not only increases access to early education but also supports families in the community. By providing quality nursery facilities, schools can help ensure that children are ready for primary education.

Supporting Disadvantaged Families

One of the key focuses of the School Based Nursery Capital Grant is to support disadvantaged families. By increasing nursery places, schools can offer more opportunities for children from lower-income backgrounds. This can lead to better educational outcomes and a more equitable start in life.

Community Impact

The expansion of nursery facilities can also have a positive impact on the local community. More nursery places mean that parents can return to work or pursue further education, knowing their children are in safe and nurturing environments. This can lead to a more vibrant and economically stable community.

Conclusion

Phase 2 of the School Based Nursery Capital Grant offers a significant opportunity for primary schools and maintained nursery schools in England to expand early years capacity and better serve local communities. With up to £150,000 available per project and a strong emphasis on supporting disadvantaged families, the programme builds on the success of Phase 1. If your school is eligible and ready, gather all necessary approvals and supporting evidence ahead of the 11th December 2025 deadline.

If you have already been successful in Phase 1 or simply want our advice on how to develop your nursery playground, please get in touch!.