Mate I feel for you! We've been through this process ourselves about a year ago and it's a nightmare. Here's what we learned:
Childminders are self employed businesses, they are not employees and therefore have no 'entitlement' under law for things like paid holidays. If they are a 'nanny' and are employed as such, then you do have to pay them for their holiday entitlement (27 days including Bank Holidays I think) but you also have to pay PAYE/NI contributions etc. If you're not paying NI then you're not employing a nanny.
Every childminder we interviewed wanted to be paid for their holidays and wanted us to pay when we took our son away on holiday also. In the end we negotiated that we would pay for one but not the other and our child minder agreed. We do not pay her when she takes holidays but we do when we take him out.
£1200 seems like a lot unless you're in central London. We're down in west sussex and full time care, 8am to 5pm, including lunch, nappies and all trips out (he went horse riding last week for example) and it costs us about £1000 a month.
When you find a child minder you trust, then you won't feel half as bad at the cost; you'll also want to hang on to them at all costs. If you're baulking at their rate or their demands for concessions, then it's more than likely because you don't see the value and/or don't trust them.
For us part of that trust came from the fact that the childminder was willing to partner with us and be equitable. She recognised that we were making a big commutment to the hours we were offering her and that on a lot of occassions we are able to have our son here rather than take him to her, so all in all, she gets a good deal from our placement. In return for that, she was willing to give up on her paid holiday and consequently we feel we have someone we really trust.
Best of luck. It's a really hard pill to swallow initially but a good one will make your life so much easier.
