Plan to improve standard of care

And local authorities will receive additional funding to enable them to offer more care in people's own homes by improving services.

The �125m package goes beyond the scope of a report by a royal commision headed by Sir Stewart Sutherland - now Lord Sutherland.

The Sutherland Report, which advocated provisions not available elsewhere in the UK, sparked a protracted period of debate and parliamentary review.

Mr McLeish said that by putting on the table the additional �125m each year to implement the package, the Scottish Executive had underlined its commitment to putting older people at the top of its priorities.

He said: "In implementing free personal care, we are building on the foundations of our earlier response to the royal commission and in this package, moving beyond the commission's recommendations.

"We are also investing in building up improved care services in order to allow more people to stay at home, which is where they want to be."

Personal hygiene

The announcement followed last week's publication of the findings of the parliamentary Care Development Group, which was headed by deputy health minister Malcolm Chisholm.

The group took more than six months to draw up its findings and recommended support of up to �90 per week to meet personal care needs, including personal hygiene, food, diet and counselling services.

The group had been set up to explore the findings of the royal commission.

An implementation support group will be established to take the Care Development Group's recommendations.

Lord Sutherland: Commission report

Speaking ahead of the announcement, Lord Sutherland said: "I think they (the Scottish Executive) have picked up a great deal from our additional report, particularly the definition of personal care.

"It seems to me that the report of the Chisholm working group has been a fair and open process and the report that they have come up with has answered questions raised from a variety of contexts."

The group's report concluded that the cost of personal care could be contained within the �100m annual budget identified by ministers in June.

But it said Westminster should transfer �20m, usually handed out in the form of attendance allowance benefits paid by the department of work and pensions.

There is no deal yet with the Whitehall department on part-funding the package but Mr McLeish has expressed confidence that this can be achieved.

Nicola Sturgeon: Scots could be worse off

The Scottish National Party welcomed the announcement but warned that if Westminster does not agree to the funding deal, pensioners north of the border could be worse off.

Community care spokeswoman, Nicola Sturgeon, said: "We have calculated that Westminster's outrageous decision to withdraw funding for the attendance allowance will leave the Scottish government with a gaping funding hole of �21.7m.

"If Westminster withdraws the attendance allowance, costs will escalate to more than �145m. That hole equates to �55 per week per person."

The executive promised in January that it would implement the Sutherland recommendations amid concern, some of which stemmed from ministers' own back benches, that it would not endorse all of the proposals.

Opposition politicians in the Scottish Parliament argued that the executive only committed to free personal care for the elderly after prevarication over the issue.

Labour has also had to see off pressure from south of the border, where the package will not be available.