An increase in the old-age pension to about €208 a week, a multi-million euro package for elderly care and a substantial increase in support for carers are to be unveiled in next Wednesday's Budget as part of a Government strategy aimed at attracting the "grey" vote in the general election.

Minister for Social Welfare Séamus Brennan is understood to have secured a commitment from Minister for Finance Brian Cowen for an increase in the contributory old-age pension from €193 a week to about €208 a week.

It is also understood that the Progressive Democrats are still negotiating with their Government partner for a cut in the top rate of tax of 42 per cent. There is growing confidence within the party that Tánaiste Michael McDowell will be able to deliver at least a one percentage point cut in the top rate.

While the PDs have been pushing for a cut in the top rate, Fianna Fáil's preferred option is to widen bands and allowances. However, Mr McDowell is pressing his case.

Taoiseach Bertie Ahern signalled at the Fianna Fáil Ardfheis earlier this month that the old-age pension would be increased to more than €200 a week, as promised in the Programme for Government, but he did not specify at what level the pension would be set. Mr Brennan and Mr Cowen have had pre-Budget talks in recent days and it is understood that the rate is likely to be €208, although the matter is still open for further consideration.

Mr Brennan is also hoping for a significant increase in the non-contributory pension from €182 a week to somewhere in the region of €195. In addition money for the carers allowance is expected to exceed the €30m given in last year's budget.

Meanwhile Minister for Health Mary Harney is finalising an elderly care initiative to provide for a range of services to keep people at home and out of residential care.

The package, expected to be worth in excess of €100 million, will allow for an increase in home nursing and therapeutic services, home help, meals on wheels and day-care services. It will also provide for more people to be eligible for nursing home subvention.

It is understood that Ms Harney is also arguing for a reduction in stamp duty for older people seeking to buy more suitable accommodation.

Eighteen per cent of the population is aged over 65. With this figure likely to double over the next 20 years, the Government believes it is important to provide for this age group. Last year, Mr Cowen announced a package for elderly care including €20 million towards the nursing home subvention scheme and funding for an extra 250 nursing home beds for public patients. Money was also allocated for community-based services and the provision of hundreds of extra home-care packages.

Ms Harney is finalising a deal with Mr Cowen to allow for a significantly increased package next week. A source said there was "very good value" from last year's package with more than 3,000 home care packages secured and an expansion of home help services.

Earlier this year Ms Harney signalled that a key priority of the Government is to support people to let them stay at home for as long as possible. She said long-term residential care would always be required, but many older people with lower levels of dependency could be cared for in their communities.

"Less than 28 per cent of residents in long-stay beds are in the low to medium categories. This represents over 5,000 people and I find it difficult to believe that many of these could not have been cared for at home if the right level of supports were in place."