European leaders have been discussing the idea of an EU wide unemployment benefit funded by tax payers, UKIP MEP Jane Collins has revealed.
In an extraordinary meeting of the employment committee Minister Pier Padoan put forward proposals for a centralised EU run fund to deal with the millions of unemployed people, many as a direct result of the eurozone crisis and the policies of the European Central Bank.
The economist said he thought that the funding for the scheme, which was proposed by the Italian government in the ECOFIN meeting of European economic ministers, should come from "collective instruments" i.e taxes.
"There are a number of channels via how countries can fund such a scheme," said Mr Padoan. "Clearly it would have to come from member states."
"One of those is proportionally via GDP" he told Euro MPs with the other being taxation which could, like VAT, be a direct financial resource for the EU.
And the minister said that the project could well go outside the Eurozone, saying that what was needed was "more integration in the future."
The opposition to the scheme was led by UKIP employment spokeswoman Jane Collins MEP who said that British tax payers should not be funding any unemployment schemes in other countries.
"We already pay child benefit to children who do not live in the UK, we already pay unemployment and in work benefits to EU migrants who come to the UK for jobs, education and housing and we have seen a decline in real wages thanks to an oversupply of unskilled workers which has put our own people out on the scrap heap," she said.
Mrs Collins also confronted an Italian minister who was proposing an EU wide unemployment benefit over the different attitudes to helping the steel industry held by their respective governments.
The party's employment spokeswoman asked the Minister if he agreed that the UK should have to go "begging" to the European Commission for permission to help out the British steel industry.
'Italy, like my own region of Yorkshire and North Lincolnshire in the UK, has seen its steel industry suffer. However unlike the UK government, the Italian government provided 2 billion euro in state aid to the country's steel maker, Ilva," she said.
"Now the European Commission's competition commissioner Margrethe Vestager has said they will be probing Italian state assistance, saying that despite realising the European industry faces overcapacity and tough competition from abroad, steel makers cannot be exempt from state aid rules.
"But Tata steel, where the largest number of jobs in the UK have been lost from, blamed high energy prices because of the EU's slavish devotion to meeting green targets whilst countries like China do not concern themselves and instead focus on jobs,
"So why would we want a European wide unemployment scheme instead of de-regulation to make us more competitive and respond quickly to global market changes without having to go begging to Brussels? Do you think Ilva should have to pay back the 2 billion and the Italian tax payer then fund unemployment benefits when jobs are lost?"
But the minister seemed angry by the mention of the Italian government's financial involvement in helping Ilva, saying "The Italians don't go with a begging bowl to anyone."
Afterwards, Mrs Collins expressed her surprise at the minister's angry response, saying she thought it was "entirely fair to ask why one country was allowed to stop the haemorrhaging of job losses in its steel industry when the UK government were unable to help."
"Personally I think it's ridiculous that we have to ask permission for state aid from the European Commission given that we are trying to counter their destructive policies on energy," she said.