Frequently asked questions

Capital works grants are funds given to eligible not for profit organisations to undertake capital works projects and deliver additional community preschool places in areas of need and demand across the state. 

The Start Strong Capital Works Grants Program enables eligible not-for-profit organisations to access funding across four grant categories, including

  • Major Capital Fund
  • Crisis Fund
  • Minor Capital Fund
  • Mobile Fund

The decision to apply for funding rests with the applicant organisation. Any decision to apply for a capital works grant should first be discussed with your governing body.

Important things to consider include:

  • Are you currently operating or intending to operate a centre based community preschool or mobile preschool service?
  • Do you meet the eligibility requirements?
  • Do you intend to create additional preschool places?
  • Has an increase in preschool places been considered in your business planning?
  • Is there need and demand for preschool places in your community?
  • Is your organisation committed to managing a capital works project, if you are awarded a grant?

It is up to applicants to determine if they meet the eligibility requirements outlined in the program guidelines for each of the four funds.  There are separate eligibility requirements for each Fund. 

Previous applicants are welcome to apply. If you have previously been awarded a grant and have since withdrawn acceptance of that grant, this will not impact your application.

If you have a Capital Works Grant in progress, you must deliver the pre-existing project and the increase in preschool places with the existing grant funds. The department cannot award additional funding for preschool places already committed.

If you have been previously awarded a Capital Works Grant and have not progressed with your capital works project, the department may request that you close this grant prior to awarding a new grant. 

You can register for an online information session. Attending an information session will give you the opportunity to ask questions and ensure you understand the eligibility and application requirements.

As a minimum, we encourage you to review the Program Guidelines, the Application Guide and the Terms and Conditions prior to submitting your application.

If you have any questions, please contact the Capital Programs team on or via telephone on 1300 755 426.

Once you submit your application you will not be able to send further documentation unless the department specifically requests it. We encourage you to submit a complete application to guarantee your application can be properly assessed.

Funds have either extended, continuous or multiple rounds, giving providers time to prepare and submit complete applications.

A glossary of commonly used terms is available to assist applicants in understanding program-specific terminology. 

If you still need help, you may contact the Capital Programs team on or via telephone on 1300 755 426.

Need and demand refers to the current shortage in preschool places, it factors in the current supply of available preschool places and the projection of future demand for preschool places.

The department will consider its own data on need and demand, however you may also submit evidence to support your application. This could include;

  • An overview of demand for community preschool places, including a waiting list for the service and community feedback.
  • Evidence of significant growth in the number of children and families in the area due to population growth, new industries or residential development.
  • Evidence of an identified shortage of community preschool places in the area.
  • Other significant factors that indicate a new demand or shortage in the local area. For example closure of other early childhood services delivering community preschool programs.

All amounts listed on your application must be excluding GST, this includes the grant amount being requested.

If you provide amounts including GST, this can artificially lower the value for money of your project and it may impact the assessment outcome.

You must contribute at least 5% of the total project cost (ex GST), this is the provider contribution. The provider contribution can be comprised of preschool funds and/or loans. Applicants will be required to confirm and provide evidence of the availability of these funds, including loans (if any).

Provider contributions are not required to be over 5% of the total project cost, however please note that provider contributions above 5% may have a positive impact on the value for money calculation for your project. 

Providers are encouraged to use other sources of funding to support the delivery of capital works projects, in addition to the grant and the provider contribution.

Other sources of funding can include other grants from State, Federal or Local Government, any donations from private or public organisations and in-kind services. In-kind services (for example, the offer of free engineering services) should be listed on your budget but should be quantified as $0 (for all other contribution types the amount contributed must be specified).

Applicants must confirm and provide evidence of the amount and availability of these funds. These amounts will not be funded by the department. 

The total project cost must factor in all expenses, including professional and project management fees, legal fees, contingency and any other administrative costs related to the project. 

Total project expenses should be equal to the total project budget, including the grant amount, provider contribution and any other sources of funding (if any). For capital works projects it is recommended you include as a project expense at least 10% of the total cost of the project for contingency purposes, to cover unforeseen circumstances, inflation or overruns. Please note that should any of these additional expenses arise, they must be funded by the approved provider. Further information on budget elements are outlined in the Application Guide.

If you have submitted your application in error prior to the closing date, you may retrieve and further edit your application from SmartyGrants by contacting the Capital Programs team on or via telephone on 1300 755 426.

SmartyGrants is a user-friendly platform. You can view the help guide for applicants for an explanation of the essential steps you need to take to complete and submit your application form.

Following the closing date, applications will be checked for eligibility and completeness. Eligible applications will progress to the assessment stage. Applications will be assessed against the assessment criteria established for each funding category as outlined in the program guidelines.

Applicants will receive updates on application assessment and approval timeframes as the process progresses. Timeframes will vary and will be dependent on the volume of applications received.

Long Day Care services are not eligible. Please note that running a preschool program within a Long Day Care setting is not the same as operating a Community Preschool. 

If you intend to use the capital works funding for an increase in community preschool places only, then yes you can apply. 

You must differentiate the Long Day Care and Community Preschool components of your project throughout your application. This grant cannot fund any increase in Long Day Care places, including any Long Day Care places allocated for preschool programs run within that setting. If your project proposes an increase in Long Day Care places, these would have to be funded by the provider or other sources of funding and evidence of this should be provided on your application.

If you do not intend to increase community preschool places with your project then you will not be eligible for funding. The Major Capital Works Fund does not fund projects that do not create additional community preschool places.

The purpose of the Capital Works Grants Program is to increase community preschool places in areas of need and demand through the delivery of capital works projects. Organisations should carefully assess their capacity to increase community preschool places.

Successful grant applicants will be accountable for increasing licensed preschool places on the National Quality Agenda IT System (NQAITS) once the project is complete and must make reasonable endeavours to fill these as community preschool places, in accordance with their capital works grant funding terms and conditions.

During the compliance period providers may be requested to submit evidence of the number of community preschool places,for example enrolment information or census results.

The compliance period runs for ten years from the date the capital works project is completed, which means completed buildings must be able to offer the community preschool places created by the capital works project for this period (ten years).

Applicants must be able to provide evidence that they have the capacity to secure the proposed site for the entire project and compliance period through land ownership, a long-term lease or other suitable arrangement. 

A security instrument is a form of guarantee that is in place for a period of ten years from the date the capital works project is completed. It provides security to the department against the value of the grant should the grantee in any way fail to complete the capital works project or meet the terms and conditions of the funding agreement. 

The department’s security preference is a mortgage for owned premises, or a mortgage of lease for leased premises. The department may propose an alternate security instrument where the preferred security instrument is not available. The department will work with successful applicants to agree on the appropriate security instrument for the grant.

We encourage you to discuss this requirement with your committee, landlord or any parties involved in your site arrangements prior to submitting a grant application as providing a security instrument is a precondition for funding.

More information regarding the security instrument can be found here.

If you propose to build or upgrade a service on a public school site you must have a current licence agreement to operate the service prior to applying for the grant.

Please note that Early Childhood Education and Schools Policy does not manage the allocation of licences to operate preschools on school sites. This process is independently managed by Schools Infrastructure NSW.

For further information in relation to your current licence, please contact Schools Infrastructure NSW on

The department strongly encourages you to use the application guide and refer to the following websites to attain a better understanding of the components of project builds including development application requirements, timelines, procurement approaches and managing risks associated with major capital works.

These NSW planning guidelines are used by consent authorities (i.e. local councils) when assessing a development application for a centre-based early childhood education and care facility. The guidelines cover a broad range of requirements for early childhood education and care services in NSW.

If you plan to deliver your capital works projects on crown land leased through your local council, you may wish to refer to the link below:

The grant is paid in instalments in accordance with project milestones. The grant type and total project cost will determine the number of project milestones and payments.

For example, if you have 4 milestones then you will be paid:

  • 40% for Milestone 1 completion
  • 30% for Milestone 2 completion
  • 20% for Milestone 3 completion
  • 10% for Milestone 4 completion

You are required to submit Progress Reports and evidence to the department when you complete a project milestone. The department will assess the Progress Report and if it is satisfactory, will arrange payment of that milestone. Evidence should include any relevant approvals, reports or certificates related to the capital works, before and after photos and itemised invoices, among others.

Please note that you must use the Progress Report template issued by the department.

There is no limit on the grant amount you can request.

Your increase in community preschool places is the number of licenced (per day) community preschool places that you intend to create as a result of your project.

For example, if you currently have a licence for 20 children per day as recorded on the National Quality Agenda IT System (NQAITS), and you expect to have a licence for 25 children per day after the capital works project, your proposed increase in community preschool places is 5.

You should carefully consider the space planning guidelines and regulatory requirements for Early Childhood Education to ensure the increase you are proposing is feasible, noting you will be required to provide evidence in this regard.

Please note that whenever the Capital Programs team refer to community preschool places we mean per day or licenced places and not 600-hour or per-week places.

If you are relocating a service to a new site subject to capital works, the increase would only be the additional places that can be accommodated in your new site. For example, if you currently have a licence for 30 children per day as per NQAITS and you expect to have 40 in the new site after the capital works, your proposed increase would be 10 places per day.

If you are a multipurpose service, please note on your application what the current split between Long Day Care places and Community Preschool places is like and the places you intend to deliver for each service type.

Please refer to the Application Guide for further assistance.

Value for money is determined by looking at the total benefit and the total cost of your proposed project.

When reviewing the cost of your project, the Department will consider the “cost per place”. This is calculated by dividing the grant amount requested from the department, excluding GST, by the number of licenced (per day) community preschool places you intend to create with your project.

If your project has a lower cost per place, this may positively impact your value for money assessment. Noting that the benefits of your project will be considered along with cost.

To clearly ascertain the cost and value for money of your project it is vital that:

  • Your application is complete.
  • Your proposal clearly outlines the number of community preschool places per day you intend to create with your project. For the purposes of this grant, the increase in places must be the number of community preschool places you intend to deliver once the capital works project is complete. Please consider the spaces and regulatory requirements for increasing community preschool places to ensure the proposed increase is feasible.
  • You provide  quotes obtained in the past 6 months to substantiate your claims.
  • You provide a clear budget that outlines all the financial elements of your project (grant amount, provider contribution, other sources of funding if any and total cost of the project). All figures must be excl GST and must be consistent throughout the application. 

To improve the value for money of your application you can:

  • Test the market by seeking multiple itemised quotes for your project.
  • Reduce the grant amount by increasing the provider contribution or seeking external sources of funding.
  • Reduce the grant amount by removing non-essential elements of your design, revising the types of materials used in your build or ensuring you are not seeking funding for non-eligible elements as per the fund guidelines.
  • Reduce the cost per place of your project by maintaining the grant amount, but increasing the number of preschool places per day your project can deliver.

When calculating the number of community preschool places that can be created with your project you must take into consideration the space and regulatory requirements for Early Childhood Education services. You will be required to provide evidence as to how you calculated the proposed increase in line with regulatory requirements.

Major capital works projects must be completed and acquitted within 24 months of the funding agreement being executed. Funding agreements must be signed by an authorised officer in the applying organisation no later than four weeks after receipt. If you don’t think you can meet these timeframes we encourage you to apply at a later date.

If you do apply and experience unexpected delays please contact the Capital Programs team as soon as possible. Please note that as per the funding terms and conditions Approved Funded Providers are responsible for any shortfalls in funding or overruns that may arise.

Major Capital grants can only fund spaces that will be used primarily to deliver community preschool education. If there is a portion of the build that will not be used primarily for this purpose (e.g. rooms allocated to community or health services), these spaces must be funded by the provider or other sources of funding. This should be clearly noted on your budget breakdown.

Similarly, if you are a multipurpose, please make sure you differentiate on your budget the portion of your build that will result in an increase in preschool places. This grant can only the fund the portion that will result in an increase in community preschool places. The provider or other sources of funding will have to fund the portion of the build that will result in an increase in Long Day Care places (if any). 

Refer to the Major Capital Fund guidelines for a list of elements which can and cannot be funded by the grant.

Submitting a Stage 2 (Invitation to Apply) application does not guarantee funding. Stage 2 applications are competitively assessed and only successful applications are recommended for funding. The capital works project should not commence until applicants receive formal application outcome stating that the project has been awarded funding. 

Funds cannot be released until the security instrument and funding agreement have been negotiated and fully executed by all parties.

Please note that depending on your circumstances, the execution of a security instrument can take time. Please factor this in to your timeframes and requirements prior to entering into any contracts with any third parties, to avoid any financial hardship. 

Please note submitting quotes obtained in the past 6 months is a requirement to assess the value for money of your project. At least one recent quote must be included in your Stage 1 application and two itemised quotes that reflect the final design of your project must be included in your Stage 2 application.

Applicants should contact the department if they are unable to obtain the required quotes. In exceptional circumstances this requirement may be waived. 

A suitable project manager must be identified and appointed within four weeks of the funding agreement execution.

For applications with a total project cost of $500,000 excluding GST or above, applicants will be required to provide evidence of their project manager’s qualifications and experience. For projects with a total project cost below $500,000 excluding GST, a suitable project manager must be identified and appointed, but you will not be required to submit evidence of their professional qualifications and experience. However, you will need to confirm that they have suitable capabilities and experience, and if they are current employees of your service, you must confirm that they have capacity to undertake these additional duties.

Please note that this grant can fund project management expenses if these are factored into your budget at the time of application and are included in the quotes provided.

Return to top of page Back to top