Nannies – the way to close the childcare gap?

We received an interesting Press Release from BAPN (the Association for Professional Nannies), what do you think?

Nannies – the way to close the childcare gap

•  There are roughly twice as many child-carers seeking nanny work as jobs available nationwide

• A nanny is the most cost effective form of childcare for 3 children under 5 and the cost remains the same no matter how many children there are in the family

• Nannies provide the most flexible form of childcare and can be paid with childcare vouchers or Tax Credits

BAPN (the association for professional nannies in the UK) has been investigating concerns about the gap in the availability and affordability of childcare. Our research shows there are many more nannies seeking work than there are jobs available. Elizabeth Henry Nannies, a Kent-based agency, says there are twice as many nannies as jobs available, a figure supported by one of the biggest childcare websites, nannyjob.co.uk, which claimed to have 4,748 CVs and 2,340 vacancies at the start of May. One agency in Greater London received 10 CVs for 1 part-time job. Yet despite this surplus of candidates nannies remain a less popular option and this may be due to the perceived cost.

We compared the average cost of a nanny, including employers’ National Insurance Contributions, with data from the Daycare Trust. For families with 3 children under 5 a nanny is clearly the most cost effective form of childcare. This is because a nanny’s rate isn’t determined on a per child basis as a child-minder or nursery is. Instead they care for all the children in the family meaning they become more cost effective as the number of children increases.

Working with an average salary of £10.27 gross per hour, the cost of a nanny for 25 hours, including employer’s NICs, is £272 per week. For a family with 3 children under 5 that’s a cost of £90.67 per child per week, compared with £102.05 for nursery care for an under 2 or £92.68 for a child-minder.

A family with twins under 2 and a preschool child could be paying out £301.61 in nursery fees or £277.23 for a child-minder, assuming they can find a provider with spaces for all 3 children. The most expensive nursery in the survey, charging £300 a week for just 25 hours of care, would make a nanny a cost-effective option even for 1 child.

BAPN used data from the Nannytax salary survey based on a 50 hour week, although nearly 50% of the nannies surveyed worked up to 60 hours a week, meaning the cost could be even lower. In addition, while costs for nurseries and child-minders are likely to be very similar in a given location, nanny salaries depend on hours, qualifications and experience.

A BAPN analyst explains: “It’s very difficult to accurately compare the cost of a nanny with other forms of childcare. The averages range from £21,291pa (with employer’s NICs of £1,907) for a live in nanny outside London or the Home Counties to £34,516pa (with employer NICs of £3,732) for a live out nanny in Central London - a huge variation. People see the highest figures and think a nanny is beyond their means when nanny jobs outside London can pay from £7 gross per hour. Nannies aren’t just for the rich; our members work for teachers, ambulance crews, normal families who need flexible, reliable childcare.”

Nannies registered with OFSTED on the voluntary childcare register can be paid using childcare vouchers or tax credits. Nannies may be shared between families, which can halve the cost for employers while retaining many of the benefits. Families with under-5s plus an older child at school may choose a nanny for flexibility and reliability, eliminating the need to worry about school holiday cover.

At BAPN, we call for the Government to provide more help to families struggling to afford the cost of childcare through subsidies, an expansion of the childcare voucher scheme and making a proportion of childcare costs a tax-deductible expense for self-employed businesspeople.