Childcare is a major expense for any working parent, in fact it’s so great an expense that it often stops the parent working.
If close to your entire wages are going to go on paying someone to look after your child, why not just look stay home yourself instead? Obviously it isn’t quite that straightforward a choice, there is a desire to work for career progression, independence and more even if it doesn’t bring in a huge sum once childcare expenses have been accounted for.
Making the cost of childcare even more difficult to stomach is that we in the UK pay so much more than parents in other countries.
The World Economic Forum analysed the percentage of their income a couple with two young children would have to spend on childcare. In the UK, this came in at 35.7% of income, the second highest percentage of anywhere in the world (New Zealand top at 37.3%). Only two other countries, the United States and Australia tipped 30%.
What of other nations? Using the same methodology, the average across all nations was around 15%, within the EU it was down at 12% – and that average boosted by the UK. In Germany, the average amount of their family income this young couple would be committing to childcare would be just 5%.
The aim of this post isn’t to delve into the structural reasons behind the differences, analysing what help is available in each nation to reduce the cost of childcare. Instead, we’d like to offer some advice on how to at least make childcare in the UK more affordable.
Huge numbers of UK parents are paying more for childcare than should be necessary – and this is quality childcare with the same provider or level of provision, we’re not talking about downgrading to a cheap option.

Workplace Nursery Scheme – If You’re Not In, You’re Missing Out

Any parent who is not taking advantage of a workplace nursery scheme is paying thousands more for childcare than they need to be.
These schemes are straightforward for employers to set up and have benefits for employees and employers alike, but first a look at the savings.
On our dedicated workplace nursery site, we have a savings calculator which will show exactly how much you could save based on your current childcare expense.
To give some examples, anyone spending £1,000 a month on childcare would save £2,942 if they are a standard rate tax payers and over £4,200 if they are taxed at the higher rate.
Someone with two children in nursery and spending £2,200 a month on nursery fees would save close to £9,500 a year if a higher rate tax payer (and well over £6,500 if on the basic rate).
Even childcare fees of just £700 per month could accrue savings of £2,000 per year at basic rate and £3,000 on the higher tax rate.
What though is the workplace nursery scheme?
In simple terms, it is a partnership between a workplace and a nursery. An employer, the workplace, links up with a local nursery, in so doing the nursery benefits by having spaces filled by the workplace’s employees and employees get to treat the childcare provision as a benefit in kind and so greatly reduce their tax burden.
The setting up of this link is straightforward and typically arranged through an expert in workplace benefits such as Enjoy Benefits, this ensures that it is not time consuming for the employer to run, while it also remains, at worst cost, neutral for them.
For the employer it is stress free, a scheme that will run in the background, for employees it is a benefit that will save them thousands of pounds, potentially helping them to return to work and also boosting loyalty – after all, people are less likely to leave a job if it is also providing nursery accommodation at a discounted rate.
With Childcare Vouchers no longer open to newcomers, the workplace nursery scheme is again growing in popularity, but the truth is that for many parents it has always been a better scheme.

Workplace Nursery – Best Of All Worlds

The savings are larger and it is also a scheme that sees the nursery get extra funding, this through NI contributions from the employer. Better still, the parents then get a say in how this extra money is used, it could be for educational resources, or to make a wonderful outside play space or any other use that benefits the children.
As a parent, you get a nursery space, you save money and the nursery gets extra funding which you have some input into how it is spent.
Admittedly, even with a workplace nursery scheme parents will still be paying more than 5% of their income on childcare, but at least the percentage should drop to more manageable levels.
Setting up a workplace nursery scheme is straightforward – we have full details on our dedicated site.
If you would like further information, whether you are an employer or employee, please call us on  0800 088 7315.