The Chancellor confirmed in his budget speech that the new Pension Credit aimed at encouraging lower earners to save for their retirement. The details of the credit were published here on 31/01/02.
In simple terms, people who have made provision for their own retirement will not be fully penalised for state benefits and income support supllied under the Minimum Income Guarantee. This has been designed to encourage people to save more.
The Pension Credit will start in October 2003 and is expected to benefit pensioners with an average of just over £400 for the average household.
The encouragement to save is not necessarily working - see today's other pension story .