Brian Cowen (Laois-Offaly, Fianna Fail)

I made a point in regard to this question. It was suggested that I have a discussion with the Minister for Social and Family Affairs in regard to the impact secondary benefits have in preventing people coming into the jobs market. I will take up that offer. However, an economic paper prepared by the European Commission in 2001 refers to the major negative aspects regarding this system as including high budgetary costs, which imply higher taxation and, therefore, increased rather than reduced distortions of the labour market. In addition, it suggested that another problem with universal public assistance schemes which are not usually combined with work, for example, a simple negative income tax system, is the disincentive effect they have on persons or families not already on welfare but who become windfall beneficiaries of universal schemes.

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