Brown targets cash at poorer pensioners

Mr and Mrs Brown are applauded after the speech

Chancellor Gordon Brown has promised to give more money to low- and middle-income pensioners.

The pensioner credit would boost incomes, while the Minimum Income Guarantee would be raised by £12 a week, he told Labour's annual conference in Brighton.

A flat-rate increase will not do enough to help pensioners on modest incomes

Gordon Brown

However, the chancellor rejected calls for an across-the-board rise for retired people and made no mention of calls for the restoration of the link with earnings.

He was immediately accused by charity, Age Concern of failing to reassure millions of elderly people.

Mr Brown was seeking to head off rising anger over pensioner poverty and this year's 75p increase in the state pension, which sparked fury among campaigners.

Defending targeting

He defended the government's approach of giving more money to the poorest.

"If we are to plan for the future, our priority cannot be that the wealthiest get exactly the same as the neediest," he said.

"A flat-rate increase will not do enough to help pensioners on modest incomes and do nothing to diminish growing inequalities but instead reinforce them."

Mr Brown first revealed his plans in a BBC interview last week, but again told delegates the details would be in his pre-Budget statement in November.

Fuel protest put-down

The new pensioner credit would reward those who had saved, but also direct cash to those on low and middle incomes, he said.

Elderly people listened carefully to Mr Brown

There would be more money for widows and for men and women who had worked all their lives, he promised.

The Minimum Income Guarantee would rise from £78 to £90 a week, he said.

However, Mr Brown had little comfort for the fuel protesters.

He said it was right to target tax cuts on the country's priorities - but these would not be decided by those who shouted the loudest and pushed the hardest.

"There will be no sudden lurch in tax or spending policy, no irresponsible pre-election sprees or pay demands that put youth jobs or any jobs at risk," he said.

Portillo 'raised taxes'

Mr Brown vaunted the government's economic achievements, such as lower unemployment and an end to boom-and-bust cycles.

There will be no sudden lurch in tax or spending policy

Gordon Brown

And he hit out at shadow chancellor Michael Portillo's promise to cut taxes, highlighting his record when Tory chief secretary to the Treasury.

"When it came to imposing 22 Tory tax rises, is it not right that we ask, where was Portillo? At the Treasury imposing 22 Tory tax rises," he declared to the laughter of delegates.

During a rousing speech, Mr Brown also called on Britain to join in a debate about the future of public spending, of taxes and pensions.

He said the government would "put ourselves at the service of the hard-workng people of Britain".

'Missed opportunity'

Mr Portillo branded Mr Brown's speech as "typically arrogant and out of touch".

He said: "Voters were desperate for evidence that he had been listening, but instead all they got was 40 minutes of self-righteous rhetoric about how he'd been right all along.

John Prescott joins the applause

"There was no apology for Labour's huge tax hikes, increasing pensioner poverty, larger class-sizes, rising crime and longer waiting lists."

Liberal Democrat Treasury spokesman Matthew Taylor said: "Gordon Brown's speech has offered nothing new. Labour will continue to lose support if it ignores public opinion and fails to deliver on pensions, public services and taxation."

The director general of Age Concern in England, Gordon Lishman, said: "The chancellor has missed the opportunity to put the minds of millions of today's pensioners at rest on the future of the state pension."

He said it was through increases to the state pension rather than income support that money gets to the poorest pensioners.

"The government's own figures show three-quarters of a million pensioners don't claim means-tested benefits to which they're entitled," he said.