…as NPRA exercises power to prosecute
Over 70 percent of 60 defaulting employers have begun paying pension contributions of their employees under the tier two scheme, following notice of legal action by the regulator, National Pensions Regulatory Authority (NPRA).
According to the Authority, an amount GH¢3.1 million has been retrieved from the companies out of an expected GH¢4.7 million between July 2020 and January 2021. About 15 recalcitrant companies have also been taken to court, while others are being processed for prosecution.
NPRA’s Chief Executive Officer, Hayford Atta Krufi revealed this at a media engagement in Accra and said the level of compliance has improved ever since the Authority was granted an Executive Instrument (EI 26) to prosecute defaulting employers on the Tier 2 schemes in July 2018 and started issuing final notice to defaulters in July 2020.
“Since July 2020, the Authority has issued final demand notices to 60 employers as a final reminder to make good their indebtedness or be prosecuted. The response to the final demand notices was encouraging since about 70 percent of the employers that received the demand notices contacted the NPRA and made good either all of their indebtedness or made partial contributions to cover their employees,” he added.
He, however, noted that a few of the employers did not respond and are in court with the first batch of six employers arraigned on criminal summons since December 2020.
“The Authority has decided to deal with the defaulting employers in batches of 20 employers at a time. Out of the first batch of 20 employers, six did not respond at all and have been summoned to court for prosecution,” Mr. Atta Krufi said without mentioning names.
Establishment of Pension College
To equip industry players with the requisite skills and knowledge, he said, the Authority would, in April, start a Pensions College and introduce a risk-based supervision system (RBS).
“I am pleased to share with you a few essential things that we at the NPRA are doing to push the industry forward. We have grown as the sole regulator of the pensions industry in the country.
The establishment of the Pensions College has become necessary primarily because during the initial stages of the pension reform, the Authority was burdened with transitional issues and had to resort to the partnership with already established training institutions, including the African University College of Communication and National Insurance College to deliver on the mandate of training the industry,” he said.
He added: “We believe that certain features that we deem fit for the development of the industry have to be applied by study and experience. We do this chiefly to ensure a holistic development of the pensions industry.”