People putting away money into savings accounts need more protection from rising inflation, claimed a leading action group.

Save Our Savers has called on the government to adopt effective measures to ensure that British savings are adequately protected.

Jason Riddle, co-founder of the action group, pointed out that the rising inflation rate was made worse by the taxing of savings interests. He lamented the fact that interest rates were no longer able to match or offset inflation.

"Save Our Savers is calling on the government to introduce new ways for savers to protect their savings from inflation and to commit to ending taxation on interest income for at least the first £5,000 of interest received; in order for all savers to gain relief from this unjust tax," Mr Riddle added.

His comments follow in the wake of recent research made public by Moneyfacts, which claimed that the increase in value added tax had hampered the chances of any reductions in the consumer price index (CPI).

It was also found that the index had slipped slightly, registering 3.2 per cent - which was higher than the government target of two per cent.

In order to offset these negative conditions savers have been advised to look around for a savings account that pays a four per cent interest rate, while those in a higher tax band should set a target rate of 5.33 per cent.

Recently, the Leeds Building Society launched a range of Isa products that can be fixed for one, two, three or five years and allow access to 25 per cent of the fund without requiring any prior notice or incurring any penalty.

Kim Rebecchi, the Society's sales and marketing director, said: "I anticipate these fixed rate ISAs, with options ranging from one to five years and access to some of the funds, without notice or penalty, will be very popular and will be available on a first come, first served basis."