The Liberal Democrats have unveiled plans to raise the state pension by 30 per cent from £79.60 to £105 a week.
The party's new pension policy would also see the end of compulsory annuities for people over 75. Work and pension spokesman Steve Webb says this move would remove a disincentive to save.
The party is pledging to take one million pensioners out of poverty overnight by getting rid of means-tested benefit systems. Its new policy would be rolled out first to the oldest pensioners over 85 and then extended to other pensioners.
The new payment would be £105.45 for single pensioners and £160.95 for couples. The LibDems propose to fund this with £2.7bn by scrapping the DTI and by making cost savings in central Government, specifically in departments such as the Treasury.
Webb says: “Women, who have for so long been the poor relation in terms of their pension rights, will benefit. They will no longer be penalised for caring for the children at home or have to be reliant on their husband's pension.”