Dr. Miche?l Collins:

If one could go anywhere in the world and write a book on using property tax incentives to see what happens, this is the country to come to. We have tried loads of them over the years and the moral of the story is that they do not work. In fact, the other moral of the story is that they tend to cause other problems that have to be sorted out and cleaned up. That probably explains what the commission said in its report. Going back to the report of the previous commission which was written following the collapse of the property market after all the other tax incentives that had fuelled much of the ill-judged behaviour in the property market, again it gave a very strong warning: do not do this again. It is a very populist thing to do. It is a very easy thing to get one's head around. It seems to keep coming back but some of us have to keep saying again and again that they do not work. We really do need to come up with more sophisticated ways of addressing those issues.

I will comment briefly on the other question on retirement savings. What strikes me is the sheer volume of cost the State is incurring in supporting these measures. As this goes on, we do need to begin to ask ourselves whether this is the best thing for us to do or are there alternatives that would either decrease the cost if we want to continue the current private pension provision system in parallel with the state pension or do we go the route of somewhere like New Zealand which abolished its tax breaks entirely, gave a universal pension and enhanced it for everybody? There are very significant resources here. It is significant that the commission's report gave an entire chapter to just one area of tax expenditure. It is telling because of how large it is and how badly it works given the policy objectives we, as a society, currently have.