Cost of childcare goes up, nanny salaries down

The Nannytax annual salary survey for 2012 showed a nearly 5% drop in nanny wages in some areas, and the greatest increase was 1.6% on last year, but the cost of other childcare has risen by more than 6% according to the Daycare Trust’s annual report over the same period.

Although it might not be good news on an individual level for nannies, for parents there is a silver lining. Live in nannies are now the most affordable option when compared to other forms of childcare. Last year we indicated that nannies were the most economic form of childcare for families with 3 or more children. It seems this year nannies may be more affordable for some families with 2 children than a nursery place, with the average full time nursery place coming in at £11,000 (£22,000 for 2 children) and a live in nanny in Outer London and the Home Counties earning £21,963 gross and a live in nanny in the rest of the UK earning an average of £20,509. Nannies are also working longer hours, with 14% working more than 60 hours a week. This makes them ideal for families with long working hours or long commutes.

Childminders and nurseries are being forced by economic circumstances to raise their fees. Increasing bills for utilities and food, the cost of compulsory training and the time taken to update paperwork in line with OFSTED’s requirements are all taking their toll. In contrast nanny salaries have to respond to the national trend for salaries, as they depend on the amount parents have free to spend on childcare. Squeezed budgets from hikes in the cost of living mean lower salaries or fewer nanny jobs.

Whichever way you spin it, childcare in the UK still costs parents too much, and doesn’t pay providers enough, nannies included. Being expected to work more hours for less money isn’t a sign of a healthy economy even if it is happening to almost everyone. But what’s the answer?

Some solutions look at the cost of childcare in general – increasing the amount of childcare vouchers which can be offset against tax, or enabling parents to claim childcare against their tax return. Others wouldn’t apply to nannies, unless changes were made, such as ring-fencing funding or paying providers directly.

There are two other solutions would decrease the costs associated with employing a nanny. For parents eligible for pre-school funding enabling appropriately registered nannies to deliver those hours would make a big difference. Another would be to provide tax relief on the costs associated with employing a nanny, such as Employer’s National Insurance.

Employing a nanny is a choice, but it’s sometimes the only form of childcare that meets parents’ requirements. Even if there are other options, it’s a choice that parents should be free to make and these figures indicate that a nanny may be an option open to more people than ever.

More Great Childcare?

Today the Government unveiled a report entitled ‘More Great Childcare’

BAPN applauds a thorough report which shows evidence of taking on board the concerns expressed by Professor Nutbrown however we are extremely disappointed by the lack of any reference to nannies, despite home based care being highlighted as meeting the parents’ needs for flexibility. We had hoped to see a provision for nannies, who are often highly qualified, to register to provide the Early Years funding which would ease the financial burden considerably for many parents. There needs to be a  focus on streamlining funding to ensure it reaches the front line and reducing costs for parents in a way that does not compromise quality. Children benefit from forming close bonds with carers and carers who are able to invest time in building relationships with them and relaxed ratios would be detrimental to this.

The report also ignores calls from within the sector for increased regulation of nannies or nanny agencies yet seeks to create childminding agencies which would be registered by OFSTED. We are concerned that a hard-headed focus on increasing quality in currently regulated sectors combined with the looser child:adult ratio will result in redundancy of less qualified staff, driving poorer quality providers to unregulated childcare work. BAPN works to raise the standard of professional nannies in line with other early years professionals. An influx of those considered no longer suitable to work in nurseries or as childminders would be detrimental to children and a real possibility if an entire sector of home based care continues to be unregulated.

The report rightly recognises there is an issue with parental confidence in the system. There is, however, no mention of the voluntary OFSTED register. Our recent consultation (report to be published) indicates that there is a significant amount of improvement to be made in this area. We fail to see how increasing the number of children per carer will inspire more confidence, even combined with more rigorous inspections and higher qualifications.

Overall we feel this report misses an opportunity to create a cohesive structure for the Early Years sector, or at the very least integrate on a voluntary professional nannies who have been marginalised by successive Governments. We call upon Ms Truss to take these issues into consideration when effecting legislative change.