Thousands of registered childminders pushed out of Early Years Industry

Yoopies UK explores the continued decline in the number of registered childminders and the connection between the latest Tax-Free Childcare

Figures released by the Department for Education last Thursday highlighted the continuing decline in childminder numbers: 39,400 in 2019, down from 40,900 in 2018 and 46,600 in 2016 (2). The statistic marks the third year on the spin that there has been a significant fall in the number of registered childminders in the UK.

As the demand for childcare increases, with over 70% of mothers in work, it is rather concerning for parents that the availability of childminders is plummeting. The total number of childminding places have fallen from 267,600 in 2016 to 239,700 in 2019, which represents a loss of around 10% of available places(3). As a result, less choice of reliable and flexible childcare options are available for parents, which is a major factor helping mothers go out to work.(4)

Childminders and Parents out of pocket

The Government revealed that the biggest source of recorded costs for childminders was paying for meals, snacks and refreshments for the children they looked after, compromising 41% of the costs incurred by childminders.(5) This is a significantly larger proportion than that of school-based nurseries and group-based providers. Childminders also incur more costs for training and materials.

Alongside rising OFSTED registration fees and other unavoidable costs, including a DBS disclosure, training course and first aid course it is unsurprising many childcare businesses are struggling to remain financially viable. The majority of childminders (60%) do not charge parents any additional fees for food, outings or other activities in addition to their hourly rate.(6)

Francesca Chong, manager of leading childminder platform Yoopies UK comments: “We are seeing on the platform that childminders are regularly raising their fees or charging extra for provisions to cover the increasing costs, which can make them a less attractive choice for parents compared to other forms of childcare on our platform.”

Last week’s statistics release supports these anecdotal findings, showing that 23% of childminders in 2019 have already increased their fees for at least one age group in the last year.(7)

The reality of Government funding

The Government aims to ensure that childcare aid is accessible and available nationwide. In theory, childcare benefits available to eligible families should enable parents to afford childcare and, as a result, allow parents to return to work. Yoopies Benefits Analysis study estimates that families working full-time could save between 20- 96% on their childcare costs thanks to benefits available in the UK, including the 30 hours free childcare scheme, Tax-free Childcare, Child Benefits and Universal Credit. Without these benefits, lower-income families risk spending between half to two-thirds of their post-tax income on full-time childcare for a preschool-aged child. The study can be viewed in its entirety ​here.​(8)

In more positive news, the Government figures show that the number of childminders offering 30 hours free childcare and Tax-Free childcare has increased significantly. In 2019, 72% of childminders signed up to receive Tax-Free childcare payments, up by 10% from 2018.(9)

Accepting this scheme offers parents better financial flexibility and as a result, more choice when choosing childcare. However, accepting these schemes can make life even more burdensome for childcare providers, due to the additional administration and paperwork involved and issues with funding from Local Authorities.

Yoopies is working alongside HMRC and Local Authorities across England to integrate these latest schemes directly into their booking and payment system, which would then allow parents to instantly use their allowances as discounts on their childminder payments. For childminders, this means less paperwork, less need to go back and forth between different platforms to manage funding claims and therefore more time to focus on delivering good quality childcare.

2 ​Survey of Childcare and Early Years Providers, 2016

3 Survey of Childcare and Early Years Providers, 2019

4 ​Childcare and Early Years Survey of Parents, 2018.

5 Survey of Childcare and Early Years Providers 2019

6 PACEY