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18th October 2012It is a 'savings scandal', that millions of elderly people are earning a low level of interest on their savings, when there are far better rates available, an MP has said.
Liberal Democrat MP Stephen Lloyd, said millions of elderly people could get better interest rates, even in their own banks, but they lack the necessary information and that is, “just not fair”.
Mr Lloyd made the remarks at the launch of a report on the challenges faced by older savers.
Devised by the all-party parliamentary group on Ageing and Older People, of which Mr Lloyd is the secretary, the report highlights research by Which? that suggests around £13bn each year is lost by UK savers due to the switching of interest rates on accounts that they struggle to keep track of.
The report builds on the stories of a number of people that responded to the APPG's call for evidence, and makes a number of recommendations to the government.
Suggestions made within the report include the need for government to make clear to the banking industry that savings accounts should not be allowed to drop too far below market rates, which is fundamentally unfair to customers.
The report also recommends that the Simple Products Working Group comes up with products that are easier to understand and offer a better deal for customers. It then calls for the industry to look to implement such products as quickly as possible.
Co-Chair of the all-party group, Greg Mulholland said he was “eager to see progress on the matter”.
“There are shocking figures that indicate that the system at present simply isn't working for a large proportion of older people who are coming under ever increasing financial pressures.
“I hope the publication of this report pushes the government take note and act to improve awareness of the issues facing older savers”, he said.