Tax relief: Minister for Finance Brian Cowen moved to abolish a series of tax reliefs after being told by independent economic consultants that they were of little benefit and had led to an over-supply of hotels, houses and holiday homes.

The review also suggested that some of the schemes were so costly and inefficient that direct public expenditure would have been a better method of delivering their objectives.

It did recommend that a number of beneficial schemes should be retained, including private hospitals, nursing homes and childcare facilities.

A number of the most high-profile and controversial tax relief schemes, supported by the Government since the late 1990s, were criticised by Indecon economic consultants, who advised that the Government should consider public expenditure as an alternative to tax reliefs.

The consultants also advised Mr Cowen that all tax schemes should require "full disclosures of key information" after it emerged that the Revenue was unable to calculate the cost to the Exchequer of the tax reliefs.

The report advised that a decision to introduce any new tax incentives "should be informed by a formal assessment of the likely costs and benefits".

Specifically, the consultants said that while the tax relief scheme for hotels had led to an improvement in both the quantity and quality of accommodation, "there is now a potential over supply".

The report also found there had been a lower level of uptake in the holiday cottage scheme, but that there was "now evidence of emerging over-supply".

It concluded that the relief scheme for third-level education buildings had been "very costly and inefficient" and public expenditure should be used instead.

While the student hostel scheme had produced high-quality accommodation, over-supply was now an issue.

The consultants were highly critical of the relief scheme for multi-storey car parks, saying that they saw "no economic or transport policy case" for it and that it had tended to "accelerate congestion in city areas".

The report also criticised the rural renewal scheme, saying that it had little effect on industrial or commercial activity and had led to an over-supply of housing in the designated Leitrim, Cavan and Longford areas.

It commended the urban renewal scheme, however.