Caring responsibilities

National insurance credits will count towards the basic state pension

Grandparents who look after their grandchildren so that the parents can go out to work will be able to claim credits towards the basic state pension.

The move means people who choose to give up work to provide childcare for their grandchildren will no longer miss out on national insurance contributions, which allows them to qualify for a full basic state pension.

In his speech Alistair Darling said: "Increasingly, grandparents play a big role in family life and in looking after their grandchildren. To reflect this we will, for the first time, ensure these caring responsibilities for grandparents of working age will count towards their entitlement for the basic state pension."

Under the move, grandparents and other adult family members who care for members of their family aged 12 or younger for more than 20 hours a week will qualify for national insurance credits towards the basic state pension from 2011.

In another move aimed at helping families on lower incomes, child tax credit will increase by an extra £20 above indexation from 2010. The Chancellor said the government had been supporting families through tax credits and providing extra help for people suffering a loss of income.

He said more people were working shorter weeks and seeing irregular work patterns and reduced wages, and that those on lower incomes would see an automatic increase to compensate for loss of income, and added that 355,000 families were receiving on average £35 a week more support through tax credits.

The Chancellor also announced help for children with disabilities in the form of additional contributions to child trust funds. Children with disabilities will receive an extra £100 a year and while those with severe disabilities will receive £200 each a year.