5 Year Agreement funding

We provide 5YA funding to schools for capital property work on Crown-owned buildings. The funding covers a 5-year period, and aligns with your school’s 10 Year Property Plan.

How 5YA funding works

All schools with property owned by the Crown receive 5 Year Agreement funding (5YA) for capital property upgrades. The funding can be used for upgrades, modernising or replacement works on existing buildings.

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Changes effective 1 July 2026

In December 2025, we announced policy changes to 5YA funding. The changes include:

  • an uplift to the 5YA base rate, from $30 per m² to $45 per m² 
  • an increase in the minimum 5YA allocation from $45,000 to $90,000 
  • a simplification of the 5YA calculation and the removal of catch-up and top-up funding.  

These policy changes apply to schools starting a new 5YA funding cycle from 1 July 2026 and every new 5YA funding cycle onwards.

How funding is calculated

Schools starting a new 5YA funding cycle from 1 July 2026 will receive a base funding rate of $45 per square metre for Crown-owned property, and we apply a minimum rate of $90,000 to all small schools and new build schools.

We calculate the funding amount based on the lesser of:

  • the actual area of Crown-owned buildings at the school, in gross square metres
  • the gross area your school is entitled to under the school property guide, plus other legitimate areas we have approved funding for.

You can see the area your school gets funding for in the School Property Guide.

School Property Guide – Education property portalopen_in_new

Isolation index

Schools and kura in isolated areas have higher operating costs. These schools get an ‘isolation index’ number that helps us calculate their 5YA funding to ensure they have enough to operate effectively. Schools with an isolation index number over 1.27 will receive an isolation rate.

Targeted funding for isolation – Ministry of Educationopen_in_new

Calculating the budget and planning

We’ll give you details of how your 5YA budget is calculated when we send you the confirmed budget.

If there’s not enough funding available to cover priority works identified in the planning process, talk to your property advisor.

Money from surplus property sales

We add any proceeds from surplus property sales to your 5YA funding.

Surplus school property

Following the 5YA spending rules

Your 5YA funding allocation is one of the inputs into your 10 Year Property Plan (10YPP). Once we've approved your 10YPP we'll send you a letter giving our approval. We’ll include two copies of your 5YA for the school board to sign. This is a formal agreement between us and the board that outlines how you’ll spend your 5YA budget.

You need to follow these rules when deciding how to use your 5YA funding in your 10YPP.

  1. 1

    Capital work

    Capital work must meet these criteria. 

    • The work:
      • creates a new asset
      • replaces an existing property or assets
      • substantially upgrades existing property.
    • As a result of the work:
      • a new asset is created in our balance sheet, or
      • an existing asset needs to be updated in our balance sheet.
    • Projects included in your 5YA need to be over $5,000 in the 10YPP. You can’t use 5YA funding for maintenance.
  2. 2

    Work on existing buildings

    You must use your 5YA funding to pay for work on existing buildings.

    There are two exceptions where you can use 5YA funding to build new areas. These are:

    • when you replace an existing building that has reached the end of its useful life – you can’t increase the net area of school buildings.
    • when you have a priority 3 project that requires extending an existing block in your School Evaluation of the Physical Environment (SEPE) – this is known as a footprint extension. You must get any footprint extensions approved by us.
  3. 3

    Work on Crown-owned buildings

    Your 5YA funding can only be used on Crown-owned buildings and facilities. If a building is jointly owned by the school board and the Crown, the project costs will be split based on the ownership percentage.

    You can't use 5YA funding to pay for work on community or board-owned buildings and structures, or build on land not owned by the Crown.

Unspent funds

At the end of the 5YA cycle, any unspent funds will be transferred to your next 5YA period.

Related pages

  • Overview of the 10 Year Property Plan

    The 10 Year Property Plan sets out the property work a school plans to complete over a 10-year timeframe. We appoint a consultant to work alongside both the school, and us, to prepare the plan.
    Read more

  • 10 Year Property Plan steps for schools

    There’s an 8-step process for preparing and submitting a 10 Year Property Plan (10YPP). Schools provide input throughout the process to ensure the completed 10YPP meets their property needs.
    Read more

  • Property maintenance grant funding

    The property maintenance grant (PMG) is part of school operational funding. It's used to maintain Crown-owned buildings and facilities.
    Read more