The National Pensions Regulatory Authority (NPRA) has said the grace period given employers to act in accordance with the new pension scheme is over, and that it will begin to scrutinise and sanction all non-complying employers.
The pensions regulator noted that seven years after the three-tier pension scheme’s coming into force, employers have had enough time to study and adhere to the scheme.
The contributory three-tier pension scheme consists of a mandatory basic national social security scheme; a mandatory fully funded and privately managed occupational pension scheme; and a voluntary fully funded and privately managed provident fund and personal pension scheme.
The regulator said it has engaged employers severally on the new scheme, to explain to them how it works.
Thus, employers who are not fulfilling the provisions of the law – the National Pension Act, 2008, Act 766 – will be penalised, the NPRA hinted.
Section 3 (1) of the National Pension Act, 2008, Act 766, mandates employers to deduct from the salary of workers, monthly, a worker’s contribution of an amount equal to five and half per centum of the worker’s salary for the period – irrespective of whether or not the salary is actually paid to the worker.
Additionally, section 3 (2) also states that: “An employer of an establishment shall pay for each month, in respect of each worker, an employer’s contribution of an amount equal to thirteen per centum of the worker’s salary during the month”.
Speaking at a quarterly outreach programme organised by Enterprise Trustees for its clients in Kumasi, the Ashanti and Brong Ahafo Regional Manager of the NPRA, Alex Owusu Boakye, cautioned trustees under the scheme to abide by the law or risk being dealt with severely.
He said the authority has served notice to all the service providers to fully adhere to the regulations, to ensure smooth operation of the scheme.
However, given the recent developments within the banking industry, he assured that pension funds are not in any way affected. He therefore insisted that individual contributors should not be worried, especially given the checks and balances put in place by the scheme.
The General Manager of Enterprise Trustees, Mr. Joseph Ampofo – also speaking in an interview, noted that growth of the pension industry has been encouraging over the period.
The industry, so far, has over 34 corporate trustees with assets under management being about 4.5 percent more than Gross Domestic Product (GDP).
He said: “Clearly, we feel that there is a growth in this industry, and also the regulator is looking at safe areas to invest in and therefore has put in stringent measures to enable us keep those funds in those areas”.
He said Enterprise Trustees has been performing well over the years, but targets to achieve more with investment in long-dated securities and in stocks.
Enterprise Trustees is a subsidiary of the Enterprise Group Limited (EGL), in partnership with the Sanlam Financial Group of South Africa.
Currently, in partnership with Black Star Holdings Limited (BSHL), Enterprise Trustees is the market leader in Ghana’s pensions industry with 28 percent market share and over GH⊄1.7billion of Assets Under Management.
It provides pension services to over 4,000 leading corporate bodies as well as individuals through its personal pension scheme.
The outreach programme forms part of efforts to periodically update and inform clients on the company’s operations while listening to concerns clients may have.