Finally, some clarity on interest rates

Even if it does, there is the question of whether savers benefit and by how much.

Last month the FCA published a report suggesting that one third of money in easy access accounts has not been moved for more than five years.

Add to this the fact that £354bn of the £700bn in cash savings is in easy access accounts, and it is easy to see why the FCA feels the cash savings market is not working.

While banks and building societies compete fiercely on mortgage rates they have not for many years competed on savings.

Dependency on high street savings has decreased, and savers have largely been faced with a ‘take it or leave it’ attitude from suppliers.

Savers have largely been faced with a ‘take it or leave it’ attitude from suppliers

A key change will be that firms must make it clear what interest rates savers are receiving. This will mean displaying the rates prominently alongside account balance information in all rate-related customer information.

But the ideal would be that any time someone checks their balance, they will also be told how much they are earning.

This would be a giant step up from the current situation in which some firms force savers to search through obscure parts of their internet sites to learn the rates paid on older accounts.

What a shame we have to wait until the end of this year for the changes to happen.

I suspect another underlying factor is that people just cannot be bothered to move their money for the pittance that is on offer.

To some the convenience of having their money in a high street account outweighs the extra 1 per cent they might earn at best after tax in an alternative.

Tying money up in a notice account or a fixed-rate bond is not an option for many. And even then the rates are hardly enticing, topping out at around 3 per cent for a five-year lock in.

There will be an added incentive to savers to find the best account from April, when new tax rules will allow basic rate taxpayers to earn £1,000 of interest a year tax-free and higher rate taxpayers to earn £500.

The potential loss of staying in a poor paying account will be greater.

Cash is an essential part of any savings strategy, yet it often seems to be dismissed and overlooked by financial sophisticates.

It is right that the FCA is now focusing on the inadequacies of this market.

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The year’s hot topic

The proposed second-hand annuity market will surely be one of this year’s hot topics ahead of its launch in April 2017.

I notice that some advisers are already saying they will not touch it with a bargepole. The way things are going, some of you are going to run out of things you will touch in the pension arena.

I remain extremely sceptical about how a second hand annuity market can deliver value to consumers.

Traders and intermediaries will surely be the big winners – but that seems to be the way of financial services.

Cashing in a monthly income for a taxable lump sum could not only have tax implications but could also affect benefits.

But let us not forget that some annuities were sold at appallingly low rates to those who failed to shop around. WHile they cannot get their savings back, at least they could decide how to invest what money they have left.

There is also the argument that a small lump sum could make a real difference to somebody’s life, which a piddling monthly income never would.

However, despite the idea being marvellous in principle, I fear that in practice it cannot work to the consumers’ advantage.

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Time is ticking

It is now less than three months to the launch of the new state pension.

In this changeover period, though, we can expect more consumer confusion, much of it stoked by the poor quality of information that has come out of the department for work and pensions.

April also sees the rate for deferring the state pension slashed from 10.4 per cent a year to 5.8 per cent – another decent deal flying out of the window.

There will be winners and losers under the new system. While the self-employed and those on lower incomes will gain, higher earners will lose.

Many gained the impression the new pension be more generous than the existing one. This was never going to be the case.

But it will be equal and clear – and those who want more must save the money themselves.

Tony Hazell writes for the Daily Mail’s Money Mail section

t.hazell@gmail.com