Alistair Darling has announced an increase to state pensions by 2.5% or 4% in real terms, because of the negative inflation rate.

A single persons state pension will then go up to £97.65 and a couple can expect to receive £156.15 a week. Those who are on low income will see a change in pension credits and can expect to receive up to £132.60 a week or £202.40 for a couple in income.

The state pension increase comes at a time when state pension buying power has been steadily falling for a number of years.

These changes won’t take effect until April 2010, just before the general election. It has been speculated that Labour are targeting those on low income who are typically Labour voters. Every Government uses the budget report to sway voters, but with Gordon Brown still stuck in the throats of many, it may all be too little too late for Labour.