Could the £291 Granny Tax be Osborne's 10p Tax Rate?

He rushed past it. But it could prove the most significant announcement in his revenue-neutral budget. Pensioners who have seen their incomes slashed by falling annuity rates and poor interest in savings - those who don't rely on the state for all their income - will no longer be given any extra reward for their prudence. Instead their extra tax allowance will be abolished in future in the name of simplicity, and presumably helping to fund the tax cut for high earners.

In 2012/13, a pensioner over 65 has a tax-free allowance of £10,500 compared with £8,105 for other taxpayers. Someone over 75 would have a slightly higher allowance of £10,660. Even with the new tax allowance of £9,205 from April 2013, it still amounts to a loss in the allowance of £1295 for 65-74 year olds and £1455 for the over 75s.

It amounts to a £259 cut for those reaching 65 from next year and a £291 cut in potential income for older pensioners - or £5.50 a week - and Ed Miliband would be wise to focus his outrage here as much as on the new 45% rate.

This new £291 Granny Tax may make the tax system simpler. But it could prove as big a mistake as Gordon Brown's axing of the 10p tax rate, introduced for similar reasons. And just because it doesn't apply to existing over-65s, though their allowances will be frozen, it will adversely impact those who will reach that age in the near future.

They won't be happy, and many of them are Tory voters. £290 may just about buy a decent meal in one of George's ski resort hotels. But it goes a lot further for thrifty pensioners - and they will not thank George for it.