The introduction of a one per cent rise in National Insurance to be paid by employers from next April will add a further 7m, bringing the total to 28,424,000, NDNA chief executive Rosemary Murphy said last week.
The NDNA based its calculations on figures given in Children's Nurseries - UK Market Sector Report by Laing and Buisson (News, 28 March).
According to the report, in England there are currently 103,000 staff working in day nurseries for an average salary of 10,917. The 10p increase in minimum wage will see an additional salary bill for the sector of in the region of 21,424,000, based on the 103,000 staff working a 40-hour week and being paid for 52 weeks a year.
Mrs Murphy said, 'This money will have to come from parents' pockets. I'll be amazed if parents and day nurseries can absorb this amount. Regarding the minimum wage, 10p sounds little coming from the mouths of politicians, but it all adds up.'
Staff salaries account for around 70 per cent of a day nursery's turnover and Mrs Murphy warned that if they were unable to find the extra 24.4m the sector could be that much in deficit. 'Last year many day nurseries put up their fees way above the minimum wage and promised parents they would not put their prices up for a while. What will happen now, we don't know, but the industry is very nervous and very vulnerable to change and this could tip it over the edge.'
She said she was 'bewildered' at the Government's lack of support for childcare, given proposals by the DfES to widen access so more parents could find affordable, quality places while the Treasury was making it more difficult for nurseries to deliver them. 'The childcare sector is facing a recruitment and retention crisis. Lack of staff and high turnover are damaging the ability of the sector to deliver the places parents are crying out for. The recruitment crisis will only be solved when day nurseries are enabled to pay their staff the salaries they deserve.
'The Government must make the necessary commitment to balance the equation, by giving direct help to the sector at the source of provision.'
'Day nurseries are socially responsible businesses as vital to the economy as good transport, but if we do not raise the status of the childcare profession, nurseries will start to close due to lack of staff, and ten years' expansion in the sector will go into reverse.'
