School-based Nursery Capital Grant 2027 to 2030

Following the successful delivery of phases 1 and 2 of the School-based Nursery (SBN) Capital Grant, the government remains committed to expanding SBNs across England and has pledged up to £325 million of further funding between 2027 and 2030 to support phase 3 of the programme. 

The objective of the SBN programme is to build capacity in areas of need, especially in deprived areas, enhancing the overall local offer, including through working with private, voluntary and independent providers. The Best Start in Life strategy recognises that children growing up in disadvantaged circumstances often have less access to high-quality early education, which can significantly impact their readiness for school and long-term outcomes. By expanding school-based nursery provision and integrating it with wider family services, the programme aims to improve access and outcomes for children and families. 

The School-based Nursery Capital Grant 2027 to 2030 (phase 3) introduces a local authority-led delivery model, where local authorities are responsible for developing and submitting multi-year funding proposals that set out plans for creating or expanding SBN provision in their area. These proposals can include projects across state-funded primary schools, maintained nursery schools (MNS), and Best Start Family Hub (BSFH) sites. 

Unlike earlier phases, schools and providers do not apply directly. Instead, local authorities will work with schools, maintained nursery schools, academy trusts, other responsible bodies, BSFH delivery partners and other stakeholders to identify local need and prioritise projects. Local authorities may submit multiple projects within a single proposal, and funding will be allocated by the Department for Education (DfE) based on the relative strength and ranking of individual projects. 

For the purposes of this grant, SBNs can operate as: 

• nursery classes embedded in a primary school  

• expansions to nursery classes on the site of a current MNS  

• nursery units led by governors of an MNS  

• nursery units led by academy trusts  

• childminders and PVI nurseries contracted to deliver nursery provision on a school site, or operating on a school's behalf  

• nursery classes embedded on a BSFH site. This can include both existing BSFHs or those in the process of being set-up. It can also include those co-located on a school site as well as those not on a school site. BSFH nurseries could be delivered by the local authority, but also by other delivery partners such as a PVI or childminder/s. See further guidance on what constitutes a BSFH.    

There is no fixed cap on the amount of capital funding that can be applied for per project in phase 3. Local authorities can seek funding to create new or repurpose existing space, provided proposals demonstrate strong value for money. While the use of surplus space is encouraged, it is not a requirement. Local authorities are also encouraged to combine this grant with other funding sources where appropriate, as doing so can strengthen affordability and value for money. The grant cannot be used to reimburse expenditure incurred before funding is awarded. 

While Special Schools, Alternative Provision (AP) and Pupil Referral Units (PRUs) are not eligible for phase 3, local authorities should think about how the funding can be used to make nursery environments more inclusive and meet the needs of all families in their local area, including those with SEND.