FINE GAEL agriculture spokesman Michael Creed called on the Government to "bail out'' farmers affected by the suspension of the farm improvement scheme.

Mr Creed insisted the sole solution for the 12,000 farmers involved was for Minister for Agriculture Brendan Smith to go to the European Commission to seek an extension of the deadline by six months from next December.

"This House has in recent weeks seen the developers bailed out by the banks, and the banks bailed out, through this House, by the taxpayer,'' said Mr Creed.

"What is at issue here is whether the Government will bail out those 12,000 farmers.''

Speaking in Private Members' time, he said over 42,200 farmers were approved for benefit under the scheme. They had committed €2 billion of their money improving farm buildings and waste management, with consequent benefits for everybody.

About 12,000 farmers had not notified the department that they intended commencing work.

The likelihood in any such scheme was that there would be a number, a fraction of that 12,000, who probably would not proceed anyway for a variety of reasons.

There was a substantial majority of the 12,000 farmers who were committed, by virtue of their actions to date such as planning permission, and who would proceed if they thought they could complete the work within the timeframe.

However, they were now considering whether it was worthwhile proceeding and running the risk of not having completed works on time and therefore losing the grant, with the additional consequent financial exposure.

Mr Smith claimed that the figure of 12,000 had been "bandied about'' and he did not know where it had come from.

The EU state-aid approval, which included the deadline for completion of works by next December, was based on the clear and often-repeated understanding that the scheme represented a once-off opportunity to enable Irish farmers to meet the requirements of the nitrate directive.

Mr Smith said all farmers who completed approved work, in accordance with the terms and conditions of the scheme, could be assured that they would receive grant aid. "Total expenditure in 2008 on this scheme will be approximately €377 million. That follows on expenditure of almost €114 million in 2007, and a provision of €125 million for the scheme next year.''

Mr Smith said his predecessors and himself had consistently stressed to farmers the need to meet the deadline.