Following the temporary closure of the Capital Grants scheme in November 2024, we’re pleased to share that we’ve secured sufficient funding for Capital Grants for 2025/26.
This means we can now process the 4,040 completed Capital Grants applications that were on hold.
If you haven't applied, we encourage you to submit an application through the Rural Payments service when the improved scheme re-opens later this year.
If you submitted an application and it was put on hold, you don’t need to do anything. Your application will be processed and, if approved, you’ll receive an agreement to complete your works as planned.
The Rural Payments Agency (RPA) will be in touch once your application has been processed.
If you didn’t complete your application before the temporary closure, you’ll be able to re-apply through the Rural Payments service later this year.
Once the scheme re-opens, guidance will be published on GOV.UK – we’ll blog again when it’s available.
Background
The Capital Grants scheme helps farmers and businesses by providing funding to cover part or all the cost of activities such as tree planting, buying equipment to improve air and water quality, or habitat restoration.
This makes it easier for farmers, foresters and land managers to increase biodiversity and improve the local environment.
All items in the Capital Grants scheme focus on projects that help the environment, for example, planting hedges or improving natural flood management.
The benefits often last for many years, helping to reduce pollution and improve air and water quality.
Improvements to the Capital Grants scheme
The improvements we've made are to the management of the Capital Grants scheme.
It forms part of our overall approach to evolving and refining our offers over time. As we learn more about how different initiatives are delivering results and responding to the demand we receive, we adjust and improve what we provide.
This ensures that farms and businesses continue to receive the support needed to achieve the best possible environmental outcomes.
The improvements we’ve made include controls to manage demand.
Capital Grants will still support investments that improve water quality, air quality, natural flood management, restoring and improving boundaries and tree planting, but with a few tweaks:
Spending caps
Last year we saw huge demand, with some applications worth over £1 million. This meant funds were used up quickly and many farmers missed out. The new controls aim to ensure smaller farms and high-priority projects get a fair chance.
Limits will be set on how much you can apply for in each of the 4 categories. The new limits will be:
- £25,000 for water quality
- £25,000 for air quality
- £25,000 natural flood management
- £35,000 for boundaries, trees and orchards
The cap does not apply to capital plans.
You can apply for a grant in more than one category but only one application per Single Business Identifier (SBI) can be submitted per year.
If you submitted an application and it was put on hold (and you’re eligible) the new caps will not apply to you. We will honour the offer as it was when you applied.
Rolling application window
You'll be able to apply throughout the year and we’ll continue to monitor the situation to make sure demand doesn’t exceed the available funding.
This will help ensure a fair process for everyone and that the funding goes to projects with better environmental outcomes.
By keeping track of applications, we can adjust if needed and ensure the scheme remains sustainable.
Additional support and guidance
You can continue to apply for the following:
If you are an existing capital grant agreement holder, there is guidance to help manage your agreement effectively and meet its requirements.
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41 comments
Comment by Owen Standen posted on
Hi will fencing come under boundaries or water?
Comment by Sarah Stewart posted on
Hi Owen,
Thanks for getting in touch. Fencing comes under water quality, not under boundaries.
Best wishes,
Sarah
Comment by Maggie posted on
Very encouraging to hear capital grant applications are going to be unfrozen. Sensible to set a cap on the new grants so the benefits can be spread more widely.
Comment by Sarah Stewart posted on
Thanks for your comment, Maggie 🙂
Comment by Tony Martins posted on
does the capital grant scheme cover solar PV
Comment by Sarah Stewart posted on
Hi Tony,
No, it doesn't.
Best wishes,
Sarah
Comment by James posted on
We have a number of applications open subject to land mapping amendments. Will those that those applications that have been created but not submitted due to land registration/mapping be able to submit under the old terms?
We have a number of clients where applications in draft.
Comment by Sarah Stewart posted on
Hi James,
Unfortunately not. If the application wasn’t submitted, you’ll need to apply again when the scheme reopens and the cap will therefore apply.
Best wishes,
Sarah
Comment by Will posted on
Good to hear capital grants are opening again. What is the criteria if you have an existing pending application? why is one application more likely to be accepted than another?
Comment by Sarah Stewart posted on
Hi Will,
Thanks for getting in touch. All applications will be processed under the 2024 eligibility criteria, and if your application is eligible you will be offered an agreement. More detail is in the guidance: https://www.gov.uk/government/publications/capital-grants-2024/3451c5f9-431c-4530-bb47-40ac2a0abe8f
Best wishes,
Sarah
Comment by Will posted on
Thanks for your reply. Does this mean that all applications that meet the eligibility criteria will get an agreement offer and that funding is not an issue?
Comment by Phil Anderson posted on
Are the categories for forest equipment likely to be the same as 2024 as we were about to apply for a timber extraction crane in November 2024 but missed out due to the scheme being frozen.
Comment by Sarah Stewart posted on
Hi Phil,
Thanks for getting in touch. The categories for 2025 will not change. The list of items in each category is here: https://webarchive.nationalarchives.gov.uk/ukgwa/20241103213532mp_/https://www.gov.uk/government/publications/capital-grants-2024/3451c5f9-431c-4530-bb47-40ac2a0abe8f#choosing-capital-items
Best wishes,
Sarah
Comment by Phil posted on
Are existing applications in the system subject to the Cap
Comment by Sarah Stewart posted on
Hello,
If you submitted an application and it was put on hold (and you’re eligible) the new caps will not apply to you.
Best wishes,
Sarah
Comment by Ben posted on
Hello,
When are you expecting the scheme to open up again? When it closed last year the advice was that it would open early 2025. Reading this blog, this has changed to later this year?
Comment by Sarah Stewart posted on
Hi Ben,
Thanks for getting in touch. The new Capital Grants scheme will open this summer.
Best wishes,
Sarah
Comment by John Sinclair posted on
Please can you confirm whether capital grant 'SB1: Scrub control and felling diseased trees' will be capped as per your post above? I'm not sure what category this grant falls under.
Comment by Sarah Stewart posted on
Hello John,
SB1 is part of the Higher Tier Capital Grants offer which does not have a cap. You read more about the offer here: https://www.gov.uk/government/collections/capital-items-guidance-for-applicants-and-agreement-holders#higher-tier-capital-grants
Best wishes,
Sarah
Comment by Charlotte Drew posted on
That’s good news that things are moving. Please can you confirm-no new applications are being allowed at the moment? When is that likely to change? We need to plan when we can get some fencing done (which is becoming increasingly necessary!) thanks
Comment by Sarah Stewart posted on
Hi Charlotte.
That’s right. The RPA is just processing applications that were submitted but put on hold. The scheme will reopen for new applications in the summer.
Best wishes,
Sarah
Comment by Dan posted on
If you prepared a claim but didn't actually submit it will the cap apply to us?
We have CSF support letter but will be over the cap, the CSF officer was concerned that we needed to do the whole area to meet the objectives. Concreting half of the area would direct the clean water to the drains.
Comment by Sarah Stewart posted on
Hi Dan,
I'm afraid so. If the application wasn’t submitted, you’ll need to apply again when the scheme reopens and the cap will therefore apply.
Best wishes,
Sarah
Comment by Richard Swancott posted on
Hello,
It is great news that Capital Grants are re-opening. I have an application on hold from last November. If it is approved for an agreement, will it count as an application in 2024 or 2025? If the latter, will that prohibit me from submitting a further application this year?
Best wishes,
Richard
Comment by Sarah Stewart posted on
Hi Richard,
Thanks for getting in touch. It will count as 2024. You will be able to submit another application in 2025 when scheme re-opens.
Best wishes,
Sarah
Comment by Richard Swancott posted on
Thanks for your prompt response!
Comment by Sarah Stewart posted on
You're very welcome!
Sarah
Comment by Rosemary Johnston posted on
Hello! Are the cap limits for capital grants annual or in perpetuity?
Many thanks
Comment by Sarah Stewart posted on
Hi Rosemary,
Thanks for getting in touch. They are annual.
Best wishes,
Sarah
Comment by Chris Davies posted on
Hi, what is a capital plan? Many thanks
Comment by Sarah Stewart posted on
Hello Chris,
Capital plans help you either prepare for a Countryside Stewardship Higher Tier application or map moorland features to help you understand the habitat and features. You can read more about them here: https://www.gov.uk/government/collections/capital-items-guidance-for-applicants-and-agreement-holders#capital-grants-plans
Hope this helps!
Best wishes,
Sarah
Comment by James posted on
Great news that those submitted applications will now be processed; however, what will happen to those applications that have were live (i.e. created and in draft form) pending RPA mapping changes - will these be allowed to progress under the old terms?
We have a number of clients in this situation where they have incurred time and costs before the scheme was closed.
Comment by Sarah Stewart posted on
Hi James,
I think you might've submitted your question twice. I've answered a similar question above, but in case you missed it: if an application wasn’t submitted, it will be rejected, and you’ll need to reapply when the scheme reopens. The cap will apply.
Best wishes,
Sarah
Comment by john neville oliver posted on
river bank improvement and hedge planting do you apply for two seperate applications .
Comment by Sarah Stewart posted on
Hi John,
Thanks for getting in touch. It depends which items you want to apply for. If the items are in the Capital Grants offer then applications will be limited to one application per Single Business Identifier (SBI) per year. Applications for the other open grant offers such as Higher Tier Capital Grants will not be restricted to one SBI per year.
Best wishes,
Sarah
Comment by Jamie posted on
Does New Hedgerows (BN11) come under boundries
Comment by Sarah Stewart posted on
Hi Jamie,
Yes it does. It will be subject to a cap of £35,000 for the group of items in the boundaries category.
Best wishes,
Sarah
Comment by BEN posted on
Hello, will per year be a calendar year as before, or 12 months from the last submission?
Another question- several applications from last year have a submit date on them but the application can still be accessed. I presume this is still classed as submitted?
Comment by Sarah Stewart posted on
Hello Ben,
It's a calendar year.
Once an application is submitted, the status will change to reflect this in the Rural Payments system. The RPA plans to send letters or emails to these customers, informing them that their applications are being processed shortly.
I hope that helps,
Best wishes,
Sarah
Comment by Heather posted on
Is there a list of which Capital Items are subject to the spending cap, and which of the 4 categories they fall into please?
Comment by Sarah Stewart posted on
Hello Heather,
The list of items will be published before the scheme opens in the summer. The cap applies to the category. You'll be able to apply for items in more than one category.
Best wishes,
Sarah