I don't understand why a refundable tax credit system cannot be used. Simply put it means that if your income is too low to use up your tax credits (based on a 39 hour week) then the unused credits are refunded (paid) to the person in question.
With aa system like that pensions, child benefit, welfare, disability allowance etc can all be run through Revenue. That will result in higher tax compliance, a reduction in administrative cost to the Department of Social Protection and better data available to the Government to set and implement policy