Align-ju MONEY MATTERS
The changes to childcare provisions in the Spring Budget 2023 will help to alleviate some of the financial pressure on working families with young children . However , if more veterinary practices offered reduced or flexible working hours for employees with young families , they could attract and keep staff who would otherwise be unable to afford to work , and help to address the issue of staff retention in the profession .
According to the report RCVS Workforce Summit 2021 : Recruitment , Retention and Return in the Veterinary Profession [ 1 ] , 60 % of people intending to leave the profession are doing so because of a poor work – life balance , 48 % because of long and unsociable hours , and 33 % because of a lack of flexibility in working hours . The majority of those leaving the profession are aged between 26 and 30 years old .
In 2021 , the average age of mothers in the UK was 30.9 years [ 2 ] , so it is possible that many of those leaving the profession are doing so for family reasons . It is therefore important to address both the lifestyle and the affordability factors affecting staff retention .
Overview of income deductions
Many veterinary professionals have student loan debt – this applies to both veterinary surgeons and registered veterinary nurses ( RVNs ) who qualified with a university degree . A student loan is repaid via deductions from earnings . For example , for student loans on Plan 2 , deductions of 9 % are made over a threshold of £ 27,295 per annum [ 3 ] , so a member of staff earning £ 30,000 will repay £ 243.45 per year or £ 20.29 per month .
Most of us will need to pay National Insurance ( NI ) contributions – those in Category A will pay 12 % NI on any earnings between £ 1,048.01 and £ 4,189 per month [ 4 ] . Staff contributing to an auto-enrolment pension scheme will pay a minimum of 5 % of their salary into their scheme [ 5 ] .
The 2023 – 2024 standard tax threshold ( personal tax-free allowance ) is £ 12,570 [ 6 ] . Earnings over this are taxed at 20 % up to £ 50,270 , at 40 % on remaining earnings up to £ 125,140 , and at 45 % on any remaining earnings .
Based on average childcare costs for children under 4 years old , an 8-hour shift will cost approximately £ 55.07 in childcare fees ( for a 10-hour childcare session , to allow for commuting time ). This figure is derived from the Money and Pensions Service [ 7 ] , which states on its website that , in the UK , the average weekly cost of sending a child under the age of 2 years to nursery part-time ( 25 hours ) is £ 138.70 and full-time ( 50 hours ) is £ 269.86 . The average weekly cost of a sending a child to a registered childminder part-time is £ 124.41 and full-time is £ 237.28 . And the average weekly cost for a child to attend an after-school club is £ 66.52 .
The impact of all these deductions is demonstrated in Table 1 , based on annual earnings of £ 30,000 . The UK veterinary group Medivet took a step towards paying veterinary nurses a fair wage in 2022 when it set its standard wage for RVNs at £ 30,000 . Many veterinary practices also pay RVNs at this level but , unfortunately , this still falls below the UK ' s median wage of £ 31,772 [ 8 ] .
Table 1 . Example of typical earnings after deductions , for a day ' s work ( 8 hours ) on a full-time ( 40 hours / week ) salary of £ 30,000 .
Financial factors
8 hours ' work × £ 14.42 / hour
Tax ( 20 % of earnings over the 2023 – 2024 threshold )
Plan 2 student loan repayment ( 9 %)
Category A National Insurance contribution ( 12 %)
Employee pension contribution ( 5 %)
10 hours ' average childcare costs
Deductions (£)
Given the example deductions from a salary of £ 30,000 shown in Table 1 , it is understandable why many staff members may decide not to return to work after having a child , given the cost of childcare . Many RVNs and unqualified staff do not have annual salaries that meet or exceed the threshold for Plan 2 student loan repayments but they will be subject to the other deductions . After all the deductions , including childcare , a person earning a salary of £ 30,000 may take home only £ 31.47 per day . Factor that up to 4 weeks ' pay and the staff member has £ 629.40 per month to live off , which does not cover the cost of an average mortgage (£ 750 –£ 1,000 per month [ 9 ] ) let alone bills , food , clothing and transport costs .
Help with childcare costs
Running total (£)
– 115.36
13.40 101.96
0.94 101.02
8.71 92.31
5.77 86.54
55.07 31.47
Currently , there are a few schemes available to help parents with childcare costs , but some rely on eligibility criteria . Eligible families are often households where the parent ( and partner , if they have one ) has an NI number and , on average over 3 months , expects to earn at least the National Minimum Wage or National Living Wage for 16 hours per week . However , if the parent ( or their partner ) has an expected ‘ adjusted net income ’ of over £ 100,000 in the current tax year the family will not be eligible [ 10 ] .
Volume 38 ( 5 ) • October 2023
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