Childcare fees will be capped from September.

Weekly rates will be capped at €295, however, subsidies through the National Childcare Scheme will see many parents effectively pay around €198 per week, closer to the national average of €197.

The limit applies to full-day care adding up to 40 - 50 hours per week, while funding for the childcare sector will also increase.

Empty daycare. Image: Picture Partners / Alamy Stock Photo

Minister for children, Norma Foley, says the fee caps will help parents, some of whom are forking out up to €400 a week.

"The maximum now that can be charged is €295, and when the subsidy  for parents is applied, that's €198 per week.

"So for those parents paying very high fees, that's a saving of more than 5,460 a year, almost €5,500 a year".