The Cabinet today approved a redress scheme for private houses affected by bad blocks containing high levels of the mineral mica in Donegal, RTÉ's Prime Time has learned.
The scheme is to be introduced under "exceptional measures" and is not part of the official Budget.
The block defect is primarily due to an excessive amount of mica in the manufacture of the blocks.
Government Chief Whip and Minister of State Joe McHugh confirmed the Cabinet agreed that the Government will provide the funding to assess and repair private homes affected.
Mr McHugh confirmed that the Cabinet agreed the situation in Donegal was exceptional, both in terms of the scale and size of the scandal, and the exceptional cost involved.
Thousands of Donegal homes are affected, as well as a small number of houses in Mayo which are affected by muscovite mica and pyrite, and are also subject to the scheme.
The vast majority of the mica-affected homes are on the Inishowen Peninsula in Donegal.
No allocation has been made in the Budget towards the cost of the scheme, but it is expected to be at least €300m if all houses so far affected require their outer leaf replaced.
The cost would rise if sub-floors are also replaced, as has happened already in some social housing in Donegal.
If every house affected had to be demolished, which is at present regarded as unlikely, the cost in a worst case scenario would rise to over €1bn.
Affected social housing is already being addressed under separate pre-existing housing provisions.
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Last year, an expert panel review concluded that concrete blocks sold in Donegal and used in housing there over a period of years were not fit for purpose.
But the expert panel was not set up to lay blame or to show how homeowners could be compensated, so affected homeowners have campaigned since for redress.
The Donegal Mica Action Group met the Taoiseach and Donegal TD Joe McHugh in early September, and in recent weeks also met Fianna Fáil leader Micheál Martin along with local TD Charlie McConalogue.
