Dr. John Ofori-Tenkorang, the Director General of the Social Security and National Insurance Trust (SSNIT), has disclosed that how long you worked does not determine your pension pay, rather enhanced earnings or salaries remained the main determinant of pensions computations in the country.
According to Director General, contrary to negative perceptions often arising out of expectations on contributions, “SSNIT ran a defined benefits scheme on a guaranteed contract and that pension sums are affected largely by salaries of contributors and not the duration of contributions.”
Dr Ofori-Tenkorang, who was represented by Mr Joseph Poku, the Scheme’s Chief Actuary was addressing a stakeholder consultation forum in Ho, which was in collaboration with the Trades Union Congress (TUC). He noted that it is important to consolidate salaries and allowances to affect remittances. He intimated that the Scheme generously applied a formula stated by law, and that low salaries played a significant part on contributions and payouts.
“Pensions depend on the salary, not how long you have worked. Salaries translate into the pensions that are paid, and there is something wrong with earnings in the country.”
Dr. John Ofori-Tenkorang
The Director General disclosed that 99 per cent of workers do not earn beyond GHC 35,000 annually, yet the SSNIT maintained a favourable reward scheme that placed payouts on a GHC 300 threshold; almost doubling the pensions of workers of the lowest pay bracket.
“The scheme is very generous, and gives superior value to members’ contributions. Pension rights have been upheld to protect contributions. When you are put on pension, we pay you for life.”
Dr. John Ofori-Tenkorang
Compensation Paid in 2021
Dr. Ofori-Tenkorang noted that the Scheme paid GHC3.18 billion in pensions in 2021 and had maintained an indexation mechanism even as longevity of pensioners increased.
“SSNIT never defaulted on payments. SSNIT scheme is there to take care of you when you can no longer work. The Scheme’s survivors’ lump sum policy ensured generous allocations to surviving members of contributor’s family.”
Dr. John Ofori-Tenkorang
The Director General averred that it also has a reputable record of invalidity pensions for contributors who are declared unfit to work, as well as emigration benefits for workers leaving the country permanently.
“The scheme is very good. What you put in is what you get,” he stated, and appealed to all workers to take full advantage of the scheme and insure all earnings.
The Director General added that the Trust is sustaining payments through investments and attracting more contributors. He thus, stated that the Scheme currently has more than 1.7 million active contributors.
The Director General moreover, stated that only one per cent of contributors are self-employed, while 11 million of the population remained potential contributors. “SSNIT needs to do more to get them in”.
Dr. Ofori-Tenkorang assured that SSNIT has rebalanced its investment portfolios to ensure more prudent management of investments, 99 per cent of which are domestic, and which are performing well.
Dr. Ofori-Tenkorang noted that SSNIT is rolling out a comprehension programme to get more self-employed onto the scheme and would soon launch an initiative to that effect. He said the Trust would sustain public engagement, restructure its service delivery model, and introduce a mobile phone app and payment platform.
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