“The news will come as another blow for pensioners who have been the long sufferers of the credit crunch so far. This time last year, pensioners were enjoying interest rates on their savings that were ten times what they are now, when the base interest rate stood at five per cent, now the average no notice savings account has a rate of just 0.65 per cent*.

“Many pensioners who have pensions linked to the retail price index (RPI) rely on their savings income to supplement their cost of living. And, as a result, many pensioners are now worse off than they were this time last year, and in the short term this is unlikely to change,” Mr Caldwell added.

Ends

*The average no notice savings account rate according to Moneyfacts.co.uk on April 21.