I have been wondering …….. These childminding agencies ….. what will happen if a agency childminder suddenly has a drop in income?   3 comments

This is the second of my ‘I have been wondering ……..’ blogs and this one is looking at the scenario that all registered childminders experience from time to time – that of families leaving and the resulting sudden and sometime dramatic drop in income.

Take my personal circumstances, 2 full time children left – sisters. Mum suffered a bout of ill health and could not maintain her employment so gave the required months notice in October and the children left in November with everyone on good terms but with consequence of me having a huge drop in income. With it being Christmas time, it was unlikely that I would fill the spaces as the season jobs had already been filled – so nothing for it but to cut back on my personal and business expenses and cross my fingers that I filled the spaces in the new year.

Now this was bad enough for me – but just imagine what it would have been like if I had a commitment to pay an agency fee? Would the agency say ‘Don’t worry Penny, we understand, you don’t need to pay us until you fill your spaces’     I don’t think so – and why should they? They will have their own bills to pay, and as this sort of occurrence is quite common – the sudden loss of income – an agency could at any time  have several of its childminders in difficult financial situation due to children leaving. Maybe – but not very likely the agency would say pay us x amount a month and then when you are full again you will have to pay us Y amount.

I say very unlikely because if there are several agency childminders on such a deferred  payment plan, how will the agency pay its own bills and maintain the level of service required?

As it happened in my personal scenario, things got worse – 2 more full time children gave notice at the beginning of December – again for genuine reasons but this meant that financially  as from beginning of January things were dire. Staff costs still had to be paid (one staff member did leave easing things a bit),  the tax bill for 2012 – 2013 needs to be paid, all the usual setting expenses are still there . If I had to pay agency fees as well – I think it would have been ‘the straw that broke the camel’s back’

So what will agencies do in this situation? Will they be supportive? Or will they just insist that there fees are paid?

Thinking it through – will agency childminders be under contract and so unable to just leave the agency, if they can’t afford to pay the fees?

And worse – even if agency childminders can just leave the agency  – where does that leave them and the parents of the children they care for? My understanding is that you can become an independent childminder at any point in time, BUT you have to re registered with Ofsted, jump through all the hops and yes pay for everything required by Ofsted before you can finally re register – so not a easy, quick or cheap option.

Add to these scenarios of children leaving – what about all the other scenario’s which result in a loss of income for childminders?

Maternity leave

Birth of a baby (so taking up a under five place)

Childminders ill health

Childminders family member ill health

Moving house (so maybe unable to keep current clients)

Moving area (maybe due to partners change of employment)

Ofsted complaint investigation (so setting closed)

Flood, fire and so on

 

Add to that the well know fact, that sometimes (not always) it can take a very long time after registration to take on children or to be full enough to make a profit or break even. In my own personal case – when I re registered in 2010 it took me 4 months to go through the registration process and another 6 months to fill my spaces – that is TEN months in total without any income from childminding and had I become a childminder through an agency I would have had to pay the agency an agreed fee for all of those 10 months or paid an up front, one off fee- and quite frankly, I would not have been able to afford it.

To be quite honest – even if I was in favour of childminding agencies (which I am not) this potential problem with being able to afford to pay an agency – no matter what my personal financial situation was – would be more than enough to put me off from joining.

 

Government – as always – I invite you to respond – and if I have got my facts wrong or have jumped to the wrong conclusions – I would be more than happy to issue a statement from you,  presented the facts or information from you, via this blog.

Posted January 25, 2014 by psw260259 in My thoughts on current childcare issues

3 responses to “I have been wondering …….. These childminding agencies ….. what will happen if a agency childminder suddenly has a drop in income?

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  1. Interesting question, as always. In theory, should it not be the agency’s job to fill places? And if they can’t, shouldn’t they make up for the shortfall in income? 😀 If some agencies employ childminders, then they will have to pay them the same – as they would in a nursery – but that leads to another question: would they make childminders redundant if there wasn’t enough business? Maybe agency fees should be a % of income or % of profit rather than set fees for being registered? (And perhaps set fees for optional extra resources and services.) That would be fairer on the childminders, but would the agency be sustainable?

  2. Surely if you are paid by the agency your pay stays the same whether you have children or not as long as they leave through no fault of your own,its surely up to the agency to keep you full to capacity!!??

    Angeline Hargreaves
    • You would think so, wouldn’t you Angeline, however it appears it is not that straight forward.

      Look out for the next blog in the series which will focus on the issue of if agency childminders will be self employed or employed – and some the areas that I think have not been fully considered and so I have some questions

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