Friday's landmark decision by the Supreme Court that permanent foreign residents of Japan are not entitled to welfare benefits will discourage more municipalities than ever from doling out such aid amid ballooning public assistance expenditures, experts said Saturday.

Responding to a lawsuit filed by an 82-year-old Chinese resident of Oita, the top court stated in the first ruling of its kind that, legally speaking, permanent foreign residents don't qualify for public assistance because they aren't considered Japanese nationals.

The ruling is significant in that it finally clarifies whether permanent residents are eligible to claim welfare. For years, municipalities have been distributing welfare payments to financially needy foreigners with permanent or long-term residency status, including the spouses of Japanese and migrant workers from Brazil.