Homeowners in Ireland hit by a devastating building defect that causes walls to “crumble like Weetabix” are set to reject a government compensation scheme unless it offers to cover 100% of their costs.

Campaigners say the prospect of dream homes being demolished is causing people to kill themselves and families to break up, and that thousands of people could be left homeless in rural Ireland.

They plan to protest in Dublin on Friday to put pressure on the government, which could end up footing a bill for an estimated €3.2bn (£2.7bn), according to a report in the Irish Times.

“We are drowning and the government is standing on the pier with lifejackets and they won’t give us them,” said Paddy Diver, one of the founders of the 100% Redress campaign group and owner of a defective house in one of the worst affected areas in County Donegal.