The New Pension Credit The savings credit
16.The savings credit will reward those aged 65 and over who have built up a modest income for retirement. It is intended that claimants will receive a cash addition of 60 pence a week for every pound of pension (such as occupational pensions and SERPS for example) and income from savings they have above the level of the savings credit threshold (expected to be around £77 in 2003). Single pensioners will receive a maximum savings credit that is expected to be around £13.80. For every pound of income a pensioner has above the level of the guarantee credit (expected to be around £100 in 2003), the intention is that the pensioner's savings credit will be reduced by 40 pence.
17.The savings credit threshold for couples in 2003 is expected to be around £123 a week, the level of the guarantee credit is expected to be around £154 a week, and the maximum savings credit is expected to be around £18.60 a week.
18.The Act also introduces measures to ensure that pensioners who receive amounts in respect of their extra costs (i.e. disability or caring) and other amounts (such as housing costs), in addition to the “standard minimum guarantee”, also gain from the savings credit.
19.The chart below shows the impact of Pension Credit.
20.Tables showing how Pension Credit will work are at Annex B, and some examples are at Annex C.