Kennedy: Pensions demand

Tony Blair has dismissed Liberal Democrat pensions policy as "simple and glib".

The prime minister's assault came after Charles Kennedy urged the government to back an increase in pensions for older people and implement wider reform of the state pension.

The Lib Dems say many women lose out because they do not have a regular or prolonged record of national insurance contributions.

Speaking during prime minister's questions, Kennedy called on Blair to address the injustice.

"If we are seriously to tackle the ongoing discrimination against women in the operation of our pension system, then the best way to tackle that would be to establish automatic entitlement for women," the Lib Dem leader said.

The prime minister said there "was a case" for the move, but warned it could have major financial implications.

"We have got to make sure we can afford it because the bill will run into several billion pounds," he said.

Kennedy said "the oldest pensioners tend to be the poorest pensioners" - with two thirds of the poorest pensioners being women over 75.

"Why doesn't he see the merit for those pensioners over 75 of a further £25 a week?" Kennedy asked. "That is what we are arguing, why doesn't he support it?"

Cash

The Liberal Democrats say the policy would cost £5 billion, to be funded from savings made in the cost of running central government.

But the prime minister questioned the wisdom the Liberal Democrats' financial calculations.

"If we were to do what he suggests we would also have to explain where we would get the money from," said Blair.

"If we are going to make promises to pensioners, we do actually have an obligation to explain responsibly where that money can come from.

"Otherwise he and the party opposite are making promises they can't possibly keep."