2nd child about to start school - what do we do with nanny

By "start school" do you mean 2 1/2 hours of nursery or full time. When my DS goes full time (reception? Grade 1?), I'll probably drop down from a nanny to a an au pair / childminder comination. I envision something like this: Au pair will take them to school, childminder will pick them up, Au pair will pick up from childminder around 6:00, and I will meet them at home around 7:00pm. Au pair can also do some cleaning, laundry, etc. during the day.

Is your younder child old enough to be looked after by au pair rather than nanny?

We have a nanny share - we originally offered our nanny a part-time post which she wanted but said she needed a second job to work around ours..but we found a family who we are happy to share her with during the day and she was happy to 'be shared' to ensure that her income would be sufficient.
I found my nanny-sharing family through www.sharingcare.co.uk - the site charges a small fee to post an 'advert' about your family.
Also tried a few parenting boards and thegumtree.com which were free but got no takers.
There is also www.nannysharers.co.uk - which I haven't tried, only heard of them recently.
And if you are in the M25 area there is simplychildcare - also haven't tried it.
A friend of mine found a family by putting a postcard on the noticeboard of our local tesco metro!

Good luck - hope you find someone suitable and your nanny is happy.