A NOT very entertaining game is to type "best savings rates" into Google.

According to moneysupermarket.com, the first page on the search list, that would be the Santander 123 account. It is actually a current account and not a savings account, and pays an annual interest rate of 3%.

According to the most recent inflation figures, the retail price index is running at 3.3%. That's right, folks. Even if you put your money in the highest-interest account on the market, it will still be whittled away by inflation while it sits gathering interest.

The reason for this state of affairs is of course the low base rate, which explains why savers were dismayed by Mark Carney's announcement that it will probably not rise for another three years. The governor said the Bank of England had "tremendous sympathy" for savers and was trying to help them in the longer term by strengthening the economy so that there would be higher interest rates and lower inflation.

Lobby group Save Our Savers called the policy "disastrous," estimating that savers will have missed out on almost £500 billion of interest in the UK by the end of 2016 and that retirees would be forced to buy low annuity rates for their pension pots. Such is the trade-off for protecting all the households and businesses that would be crushed by higher interest rates.

This explains why the savings ratio in the UK has slumped to about 4% of income, almost half the level when interest rates were slashed in late 2008 to early 2009, and it looks to still be falling.

Senior economist Jeremy Peat says: "We're seeing a consumption-dominated recovery at a time when average real earnings are still declining. That must mean that savings are going down again and debt isn't being paid off."

Helen Roberts of the National Association of Pension Funds adds that the base rate is also a problem for pensions. Pensions have always invested heavily in gilts and other Government bonds, since they are generally seen as one of the safest asset classes. But the low base rate and quantitative easing (QE) have ensured the interest rates on these bonds have stayed very low. This has done no favours to pensions, and has created big deficits for final-salary schemes, to the tune of £134bn at the last count, which employers have to address.

She says: "The deficit picture has somewhat improved because gilt yields [ie interest rates] are higher than they were at the start of the year. But if interest rates stay low, pension deficits will remain high and the prospect for investment returns will remain low.

"QE was a necessary medicine to get us out of a crisis, but clearly caused a huge headache for pension schemes because as interest rates fell, pension deficits went sky high … If they remain high, employers will have less money to pay their employees and to invest in their companies. Therefore it might have some economic impact on the UK."