Dr John Ofori-Tenkorang, the Director-General of the Social Security and National Insurance Trust (SSNIT), on Wednesday said low pension payment is the reflection of members contribution to the Trust during active service.
He said 25 per cent of active contributors were on salaries of GH₵400.00 or less and the same 25 per cent, who were at the bottom of the pension scheme, were receiving pension payment of GH₵300.00 to GH₵400.00.
Dr Ofori-Tenkorang stated this at the Organised Labour and Friedrick-Ebert-Stifung Pre-May Day Forum.
He said, as a result of the low pension, the Government has subsidized the pensions of low-contributors on low-income.
This year’s May Day is on the theme: “Sustainable Pensions: The Role of Social Partners.”
The SSNIT Director-General said whatever contributions a member made towards the Trust would be the reflection on his or her benefit payments.
He said only four per cent of people in active service were contributing on salaries of about GH₵5,000.00 or more and on the pension scheme approximately only one per cent of pensioners were earning more than GH₵5,000.00.
He said there were also people on their pension payroll who were earning GH₵30,000.00 to GH₵50,000.00 and that was because they were contributing on a high salary.
Dr Ofori-Tenkorang said less than 50 per cent of employers paid their employees pension by the 14th of the month, as required by law, and when that happened, penalty was leveled on the employer and more often his office got petition for waiver.
He said to get employers to pay, the Trust had Compliance Officers who went around visiting offices to make sure that the contributions were paid.
He said pension payment consisted of contributions and investment made by the Trust, which had made investments in various sectors of the economy.
These investment portfolios consist of equities (the stock market), Fix income (Bonds), Real Estates, financial sector, Hospitality and the Energy sectors.
“SSNIT has only a small investment abroad less than five per cent,” he added.
He said in the past, the Trust had made certain investment decisions that did not go well but currently, it is doing due diligent before investments were made.
Dr Ofori-Tenkorang said, last year, the Trust paid pension benefits to the sum of GH₵2.5 billion to members with a little over one million spent on invalidity payments.
He said SSNIT was committed to paying all legitimate claims that came before it, adding that the Trust was not cheating pensioners.
“It is not in my interest or any SSNIT employee not to pay the legitimate claim to any pensioners,” he added.
The Director-General said SSNIT was ready to engage with organised labour and the regulator and to abide by any recommendation that came out of those engagements.
He said management, together with staff, would continue to operate an open and transparent administration and “we will create the awareness on the Trust to battle the low understanding of the public.”
Mr Hayford Atta Krufi, the Chief Executive Officer of the National Pensions Regulatory Authority, said transparency and trust were very important in the management of the Tier One Pension.
He said while adequacy of pension was the concern across the country, “we are deploying companies to continue with the education and sensitization to expand the public sector pensions in the form of provident fund or group pension scheme.”
He said this would be a top up for workers with SSNIT and the Tier two pension.
Dr Yaw Baah, the Secretary General of the Ghana Trades Union Congress (TUC), said it was important for all workers to have pension as a result of their work.
He said the focus of the TUC would be on the informal sector to change the mindset of the people concerning pensions.
“We have to change the law concerning informal sector persons and we are working with government,” he said.
Dr Baah expressed the hope that with social partners and the Government working together, they would be able to focus their attention on that sector.