- enrolling more workers
- enforcing laws to get employers to pay contributions
By the end of 2019 the Social Security and National Insurance Trust would have paid out a total of GH¢3billion in pensions benefit to its growing number of beneficiaries, Charles Akwei Garshon, Head of External Communications at SSNIT, has said.
With more and more people retiring every day and every month, the scheme paid 214,000 pensioners in excess of GH¢250million in November 2019, and payment for the month of December is expected to see more people paid.
Mr. Garshon was speaking at a pensions forum organised by Axis Pension Group, a private pension trustee in Accra, and noted that the total pay-out is a 20 percent increment on the 2018 figure of GH¢2.5billion; but assured that despite the consistent increment in benefits payment year-on-year, the scheme has introduced several measures to sustain the payment of benefits.
“We have put in place measures to sustain the increasing benefits pay-out. In the long-term we will be able to continue paying because we have rebalanced our investments to see an increase in our investment returns, and increases in our compliance rate – which means more employers pay, and pay on time; and sometime we are forced to adopt prosecution.
“Also, we have identified workers in companies as ambassadors under our focal persons training whereby we are training them to constantly engage employers to pay contributions on time. What we pay is not just contributions that have come but investment returns,” Mr. Garshon added.
He added that SSNIT has expanded into the informal sector to enrol more contributors, so that more self-employed workers can contribute and earn a pension when they retire. “The most critical thing coming up is, in February 2020, the trust will delete names of pensioners who have not gone through biometric registration. This will save the trust some savings,” he said.
Already, the trust, a couple of months ago stated that workers who turn 60-years from January 1, 2020 will no longer receive lump-sum payments; and such contributors will now have to turn to the fund managers of their second-tier contribution for lump-sums.
However, the trust – in addition to the lump-sum from the second-tier – will pay a lump-sum known as ‘past credit’ accruing from earlier contributions by such workers before the National Pensions Act, 2008 (Act 766) coming into force, which introduced the tier-two. Even though the law was passed in 2008, it was operationalised in 2010.
On the pension forum
The pensions forum seeks to equip Axis Pension’s scheme members who are due for retirement in 2020 with relevant and essential information to life after retirement. There were presentations by the SSNIT; industry regulator National Pensions Regulatory Authority (NPRA); and executives from Axis Pensions.
Ernest Amartey Vondee, Director of Research & Planning at the National Pensions Regulatory Authority (NPRA), in his speech lauded Axis for its contribution to development of the pension industry.
“The purpose of this seminar is most appropriate; more so because, first, every current employee/worker today is a potential retiree tomorrow; and secondly, economic security in old age is an integral part of every individual’s well-being; and pensions are intended to offer people this security once the worker/employee can no longer earn a living themselves.”
Afriyie Oware, CEO-Axis Pension Group, noted that people approach retirement with fear, anxiety and desperation, and it is because they did not plan toward retirement. “We planned this because we have to equip participants to plan a befitting retirement.” Mr. Oware sees this forum as a means of giving back to those who have been loyal to Axis through the years.
He noted that Axis, in the last three years, has spearheaded a drive for financial inclusion in the informal sector, and aggressively embarked on retirement-planning education in the public sector.