Stakeholders Forum held on New Pension Scheme
The Ghana Pensions Regulatory Authority (NPRA) on Wednesday held a stakeholders’ forum in Koforidua to educate and sensitize workers in both the formal and informal sectors on the new Three-Tier Pension Scheme in Ghana.
The forum sought to enlighten the stakeholders on the benefits# and the tax implications and exemptions on the new scheme as stipulated in the National Pensions Act (766) of 2008.
In his presentation, Mr Ernest Amartey-Vondee, the Acting Head of Regulations at the NPRA, stressed on the need for every individual to prepare adequately ahead of their retirement so they could have some funds to lean on when they would no longer have strength to work for income.
He disclosed that the new pension scheme was a mechanism meant to boost workers’ pension benefits at retirement, saying, it would cater for the establishment of a contributory three-tier pension scheme that would comprise two mandatory schemes and a voluntary scheme.
Mr Amartey-Vondee said the first tier was composed of a mandatory basic national security pension scheme which would incorporate an improved system of SSNIT benefits and would be mandatory for all employees in the private and public sectors.
He said the second tier involved an occupational pension scheme which would also be mandatory for all employees but would be privately managed and designed to give contributors higher lump sum benefits than was available formally under the SSNIT pension scheme.
He, however, explained that, the third tier was a voluntary provident fund and a personal pension scheme, where interested workers would on their own volition contribute towards their pension.
“The third tier is supported by tax benefit incentives which would provide additional funds for workers (formal and informal) who want to make voluntary contributions to enhance their pension benefits” he stressed.
Mr Amartey-Vondee pointed out that, the new pension scheme was important because the new pension law allowed workers to use their future lump sum pension benefits as collateral to secure mortgages for their primary residence or other needful things.
He however lamented that out of about 100,000 pension contributors, females formed only 25 per cent and therefore used the forum to encourage more females to join it.
Mr Francis E.K. Akoto, of Ghana Revenue Authority (GRA), stressed that contributions made by an employer to the third tier of the scheme on behalf of a contributor would be treated as part of the deductible income for that employer for a tax year for the purpose of income tax.
He indicated that there were more tax exemptions workers were going to enjoy if they contributed into the provident fund or the third tier scheme towards their retirement.
“A withdrawal from a scheme at anytime after certification by a medical board that the contributor is incapable of normal gainful employment due to a permanent physical or mental disability is tax exempt” he said.
Mrs Rita Afua Owusu, the Acting Head of External Affairs at the NPRA, called on workers in the country to patronise the new pension scheme to ensure a happier life at retirement since “it is now hard to rely even on your children when you are old.”
Source: GNA