Phase 3: School‑based Nursery Capital Grant (2027–2030)

The School-based Nursery (SBN) programme aims to help more families access early years provision, including those in disadvantaged areas. As set out in the Giving Every Child the Best Start in Life strategy, the DfE are ensuring that families across the country can access affordable quality early education and childcare and family support services that support them to thrive. This strategy underpins the Plan for Change commitment: to ensure a record number of children start school ready to learn, laying strong foundations for lifelong achievement.

The objective of the School-based Nursery (SBN) programme is to build capacity in areas of need, especially in deprived areas, enhancing the overall local offer without negatively impacting provision in close proximity, including that delivered by private, voluntary, and independent (PVI) providers. The Best Start in Life strategy recognises that children growing up in more deprived areas have less access to quality early education and childcare, which can significantly impact their readiness for school and long-term outcomes. By establishing nurseries within schools in these communities, the programme seeks to provide accessible, nurturing environments where children can thrive from the earliest stages, helping to close the attainment gap.

In October 2024, the DfE launched the School-based Nursery Capital Grant 2024 to 2025 (phase 1) and awarded £37 million of funding to 300 schools to create or expand SBN’s, helping parents access affordable, quality childcare where it is needed. Following its success, phase 2 was launched in September 2025 backed by £45 million of funding, with an increased focus on supporting families from disadvantaged areas to access early years provision.

The government remains committed to expanding SBNs across England and has pledged almost £325 million of further funding between 2027 and 2030 to support future phases of the programme. Phase 3 of the programme will be led by local authorities, who will be responsible for developing funding proposals that outline project plans for new or expanded SBNs in their area to submit to the DfE.

To allow local authorities to put forward proposals that meet their local need, there will be no cap on the amount of capital funding that local authorities can apply for per SBN project for phase 3, although projects must deliver good value for money.

DfE National Guidance

• School-based Nursery Capital Grant 2027 to 2030 - GOV.UK
• School-based Nursery Capital Grant 2027-2030: information for local authorities, March 2026
• Establishing school-based nursery provision - GOV.UK

DfE Eligibility Criteria

In order to apply for a SBN, projects must meet the following eligibility criteria to be included in the local authority funding proposal:

• Project aim - the proposed project will result in a net increase in the number of childcare places, taking into account any existing provisions on site or nearby, including that delivered by external providers.
• Project timeline - the proposed project will be operational and offering new childcare places by September 2030 at the latest.
• Landowner permission - there is written permission from the relevant freehold landowner (for example, the local authority, foundation/trust, or religious body) to use the land for nursery provision and carry out the proposed works.
• Project classification - the proposed project is either:
  • an SBN located on a state-funded primary-phase school site in England that already offer early education (such as reception classes). 
  • Part of a Maintained Nursery School (MNS) site in England. 
  • Part of a Best Start Family Hub (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.
  • Previous SBN grant participation - if the proposed school received funding through phase 1 of the SBN capital grant funding 2024-2025 or phase 2 of the SBN capital grant funding 2025-2026, they are eligible to apply in phase 3. However, the proposed project must add new places beyond what was delivered in earlier phases and offers good value for money.
  • Other permissions and approvals - All schools must obtain the necessary permissions from relevant stakeholders, and they must be satisfied the project meets strategic objectives for the estate and is the right solution for providing early education in the context of the whole school and for future years. Work must also comply with building regulations.

DfE Assessment Criteria

The DfE will assess funding proposals using the following:

Assessment of plans will be completed by an independent assessor(s) who may use AI to assist or support the process outlined below. The assessment process consists of three stages: 

1. Eligibility check: confirmation that projects meet the required eligibility criteria 
2. Ranking: if the total number of projects received in local authority multi-year funding proposals exceeds the funding available, projects will be ranked by: 

A. disadvantage

B. affordability 

In the event of a tie, the DfE would first consider disadvantage data at a more granular level to find differentiation, followed by affordability. 

3. Validation check: DfE will validate the projects based on both internal and public qualitative and quantitative data, as well as responses to questions submitted via the multi-year funding proposal. Questions in the proposals help DfE to understand the project context and will not be used to rank schools. The DfE may seek information from other parties / sources (such as Ofsted) in this regard.

MNS projects will be assessed using the same criteria and process for all other projects.

In the event of receiving a high number of proposed MNS projects, DfE will allocate funding to the highest ranking MNS projects, up to a maximum of 3,000 new places in total across phases 2 and 3 of the programme.

Operating Models

For the objectives of the School-based Nursery Capital Grant, SBNs can operate as one of the following models:

• 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.

Application Process

To register an interest in exploring the opportunity to establish a School‑based Nursery in Phase 3, please complete the expression of interest form (EOI) below:

Schools Based Nurseries (SBN) Phase 3 - Summer 2026 - Expression of interest

Timescales

Important dates to remember

Information Briefings

Expression of Interest (EOI)

Application stage

DfE submissions

Contact us

Check this page for updates or email the Early Years and Childcare Team at:
Earlyyearsandchildcareteam@cheshireeast.gov.uk