The Pension Credit Bill, announced in the Queen's Speech, intends to help pensioners with low incomes who may also have savings tucked away.

The Pension Credit Bill is a key part of this government's commitment to help pensioners by ensuring that those who have saved for old age are, for the first time, rewarded for their thrift

Queen's speech

The measure, which will apply to retired couples who have total income of under �200 a week, and lone pensioners earning less than �135 a week, is among proposals aimed at rewarding industry among individuals, and cutting benefits to the workshy.

A separate Welfare Reform Bill will engage partners in efforts to find jobs for the unemployed.

Mandatory interviews

The welfare bill will require partners of dole claimants to attend "work-focused interviews" held to boost job-seeking efforts.

"It would be a condition of receipt of benefit to attend such an interview," briefing notes to the Queen's Speech said.

The bill will also draw on the experience of employment zones to support efforts by the sick and disabled find work, and seek reform of incapacity benefit to "ensure that people get the right support".

"On welfare reform, we will continue to take steps which underline our belief that work is the best route out of poverty and into fulfilment," the briefing said.

Savings trap

The pension credit scheme is designed to tackle a savings trap identified in the current system.

Under current laws, elderly people with some savings face being barred from top-ups to the basic pension until they have spent all but a small amount of their nest egg.

But the Pension Credit scheme, which the government has spent some years drawing up, will render them eligible to some extra cash, with entitlement reducing as income heads towards the �200 - or �135 - a week ceiling.

"The Pension Credit Bill is a key part of this government's commitment to help pensioners by ensuring that those who have saved for old age are, for the first time, rewarded for their thrift."

Following the launch of the minimum income guarantee, the bill would also set an earnings safety net for pensioners.