As nest eggs shrink, what hope for savers?

WITh our ageing population and a worsening social care crisis, nothing is more vital to our society than workers being encouraged to save for old age.

This is why it is so profoundly disturbing that today 99 per cent of savings accounts pay less interest than the rate of inflation – which rose to an annual 2.7 per cent last month, while the average easy access account pays a mere 0.6 per cent.

Where is the incentive to save, when prudent families see nest eggs eaten away by rising prices? After a decade of miserable returns, no wonder so many prefer borrowing to saving – thus storing up yet more trouble for the economy’s future.

True, rapacious banks are partly to blame for shrinking savers’ money by refusing to pass on the full benefits of the Bank of england’s increase in interest rates.

But with households spending more than they earn for the first time in 30 years, responsibility also lies with ministers, who have signally failed to breathe life into our dying savings culture. Indeed, Chancellor Philip hammond is even said to be considering a new tax raid on pensions, which can only make the problem worse.

When he came to power eight years ago, David Cameron (remember him?) pledged that the Conservatives would stand by those who ‘do the right thing’.

Theresa May must make it a priority to match action to his words.