ING - a cut below

ING has failed to pass on the full base rate rise to its 600,000 savers, for the fifth consecutive time.

Since November of last year the Bank of England base rate has risen by 1%, from 3.75% to 4.75%, each time by 0.25%. Yet over the same period ING has increased the rate on its telephone-based account by just 0.7%, from 4.3% to 5%.

Worryingly ING has also cut the size of the increase passed on to savers. In December 2003, March 2004 and June of this year, the rate on the account went up by 0.20% - each time following a base rate increase of 0.25% the previous month.

Yet in June of this year ING announced it would increase the rate for savers by just 0.15%, despite a 0.25% upswing in the base rate. And today ING said the rate would rise by just 0.15% from 1 September, following last week‘s base rate increase,

ING launched the telephone account in May of last year with a promise the rate would remain 'at the forefront of the industry'.

Yet the bank‘s repeated failure to pass on the full benefit of rate increases is likely to leave many savers doubting its word.

Not surprisingly ING defended its ongoing decision not to put up rates in line with the base rate. A spokesman for ING said the decison meant its savings rates would 'remain consistent' - an expression also used by ING in previous months, when rates rose by less than 0.25%.

While CEO Lindsay Sinclair, said: '5.0% is a good rate of interest and we will always deliver the same good rate to all of our savers. Unlike many other accountrs in the best buy tables we don‘t have introductory bonuses or caps, which confuse savers, so what you see is what you get.'

Yet for savers struggling to see why ING can‘t both pass on the full base rate increase and remain 'consistent' there are other options.

Earlier this month Sainsbury‘s Bank gave account holders a welcome boost by increasing the rate on its Direct Saver account to 5% and slashing the minimum opening balance from £2,500 to just £1.

It has increased the rate of interest paid on the Direct Saver account by up to 1.6% since January of this year. Over the same period the base rate has gone up by 0.75%.

But there are a limited number of easy access accounts on the market paying 5% or more, regardless of balance or conditions. Those that do include Scarborough BS (5.10%), and Alliance & Leicester's internet account (5.10%). Both can be opened with just £1.

Capital One increased rates for savings customers by the full 0.25%, to 5.15%, yet this includes a bonus of 0.4% in the first year.

AA also put up the rate on its telephone-based savings account by 0.25%, The rate rose to 5.36%, but includes a 12-month introductory bonus of 0.7%.