Cannot CREATE INDEX that contains a function

I am testing Postgresql-7.0.3

Please tell me what I am doing bad.

In psql...
testdb=# CREATE TABLE test (username varchar(50));
CREATE
testdb=# CREATE UNIQUE INDEX test_index ON test (lower(username));
ERROR: DefineIndex: function 'lower(varchar)' does not exist

The same happens using upper, initcap,...
Roberto Bertolusso