Capital Grants Reopen: £150 million available for environmental improvements

The Department for Environment, Food & Rural Affairs (DEFRA) has reopened its Capital Grants offer, making £150 million available to farmers, land managers, and rural businesses across England. The funding supports practical environmental  improvements that enhance biodiversity, protect natural resources, and build landscape resilience.

What’s new in 2025?

This round introduces four new capital items: 

• Woodland condition assessments
• Wildfire risk checklists
• Stone wall repairs
• Educational access visits

Later in 2025, four more items will be added, including pond restoration and signage installation.

Funding categories and limits

Applicants can choose from 78 items across six groups:

• Air quality
• Water quality
• Natural flood management
• Boundaries, trees, and orchards
• Assessments
• Improvements

Funding caps have been introduced to ensure fairer access:

• £25,000 each for air quality, water quality, and flood management
• £35,000 for boundaries, trees, and orchards
• No limits for assessments and improvements

Only one successful application per Single Business Identifier (SBI) is allowed each calendar year.

Application process

Applications can be submitted year-round via the Rural Payments service. Updated guidance, including applicant and agreement holder guides, is now available on GOV.UK.

Why it matters

This initiative forms part of the government’s New Deal for Farmers, designed to support farm profitability while delivering long-term environmental benefits. Grants can be used on their own or alongside existing schemes such as the Sustainable
Farming Incentive (SFI) and Countryside Stewardship (CS).

Looking ahead

DEFRA plans to develop the scheme into a more competitive model from 2026, offering more targeted funding and better budget control. Farmers are encouraged to plan ahead and apply early, as funding is limited and demand is expected to be high.

Need help?
If you're considering applying or want to understand how these grants could complement your existing schemes, we're here to help. Get in touch with your usual Larking Gowen contact or email enquiry@larking-gowen.co.uk.

Laurie Hill