NPRA to establish Micro Pensions Scheme for informal sector - CEO

The National Pensions Regulatory Authority (NPRA) says it is on course to establishing a Micro Pensions Scheme to make sure that about 85 per cent of persons operating in the informal sector of the economy to contribute and receive benefits

The Chief Executive Officer (CEO) of the NPRA, Hayford Atta Krufi who disclosed this said the move would ensure that the informal sector was catered for.

Speaking to the media on the sidelines of the 10th Anniversary Dinner and Awards night on Sunday in Accra, he said, the NPRA in partnership with the World Bank and the National Identification Authority (NIA) are working together to set up a Switch Technology Centre towards having a strong database of all people in the informal sector to enrol them unto the pension scheme.

On the impact of the COVID-19 on the sector, Mr Krufi said, the government’s timely interventions have led to stability in the pensions industry.

According to him, the government’s introduction of an income tax amendment Act at the onset of the pandemic allowed people who had made an investment in the provident fund to be able to redeem their pensions.

He said, the intervention made it possible for contributors who were supposed to have paid 15 per cent tax if they had not invested for 10 years or more to be exempted from paying such tax.

“There have been people in the informal sector who have been affected one way or the other by the COVID-19 to be able to redeem their group and personal pension contributions without paying any tax, and this has alleviated the most feared expectations that we all had,” Mr Krufi said.

He said the first cohort of Ghanaian workers retiring this year under the new National Pension Act, 2008 (Act 766) would be paid promptly, and adequately, noting that the Authority was keenly monitoring all Pension Trustees to ensure that beneficiaries were not ripped off their contributions.

He also stated that the Authority was working closely with the government and other stakeholders to resolve all bottlenecks regarding payment of pension benefits as soon as practicable.

He said, “This year, the NPRA is 10 years and at the same time the first batch of Ghanaians who under the Act are retiring at the compulsory age of 60 are now coming out, and we at NPRA are very much aware of the urgent need for these Ghanaian workers to receive their benefits intact and as early as possible.”

Mr Krufi stated that the Board of NPRA had approved the establishment of the Pensions College which would be operational from the end of the first quarter of 2021.

The College, he said would provide training to trustees, pension fund managers, and pension fund custodians to enhance their knowledge of the industry and its operations and to also ensure fiducial responsibility and accountability.

In addition, the Board has approved the establishment of risk-based supervision this year to ensure full automation of operations and improve upon the existing compliance-based regulation and supervision.