If you pay peanuts, you get monkeys! Nursery Nurse salaries in my area are around £13,000 per year. Managers are not on that much more.
Nursery staff are paid low salaries (often NMW) and are typically quite young. Some nurseries are better than others in this respect - employing a variety of ages of staff and paying as well as they can, so they retain loyal staff. Staff turnover in the sector is quite high in some areas.
Increasing staff salaries however isn't practical, as who pays for it? Parents. Parents often want low cost childcare. Parents are already paying a considerable amount of their take-home pay, for childcare... for some parents, they can be working for next to nothing having deducted their childcare costs. Therefore they don't like it when childcare fees go up - recent example.
While there is regulation in place, the rules can be interpreted in various ways. One issue involves how many staff should be on duty - minimum is 2, but is that 2 for the entire nursery, or 2 per room? The Full Day Care National Standards are not clear on that point... and when I came across that exact issue when temping in nurseries, I consulted a senior inspection team manager at Ofsted, and was told that they could not enforce there being 2 members of staff in a room.
Yes there are bad nurseries, but there are also great nurseries. Parents make the choice, based on many factors - particularly visiting the nursery, spending some time getting familiar with the setup. Inspection reports are just a snapshot, and while they may be helpful, they can be misleading, as they only show what the nursery was like on a particular day (or days, if Care and Education inspection), rather than how it is the rest of the time.
Haven't been able to read the BBC article (firewall is blocking it for some reason), but I expect it's the usual thing... plus has been published just in time for the BBC pro gramme tonight (Whistleblower 8pm BBC1) which is about some journalist getting work in the childcare sector.