Campaigners say the grant has been a "significant" help

The Department of Health said it was increasing the Carers' Grant by �60m to �185m a year, until at least 2008.

An estimated five million people in England are looking after a partner, friend or family member who is ill, frail or has a disability.

Carers UK, a charity which campaigns for better recognition and help for carers, welcomed the announcement.

"The Carers' Grant has made a significant contribution to recognising the crucial role carers play and the contribution they make," said Imelda Redmond, chief executive of Carers UK.

New rights

Under the Carers (Equal Opportunities) Act, which comes into force on 1 April in England, local authorities must do more to help carers.

A large part of the financial and practical support available to carers is based on assessments conducted by local authorities.

From April, these assessments must consider the needs of the carer. For example, if the carer is working, would like to work or any training or leisure activities that could conflict with their caring responsibilities.

Campaigners have said the new legislation is a major breakthrough for improving the rights of carers. They believe it should help carers lead more fulfilling lives.