SSNIT announces 25% pension indexation rate for year 2023

The Social Security and National Insurance Trust (SSNIT), in consultation with the National Pensions Regulatory Authority (NPRA) and in line with Section 80 of the National Pensions Act 2008 (Act 766), has indexed monthly pensions upwards by 25% for the year 2023.

The new increment was announced at a press engagement jointly addressed by the Director-General, Dr. John Ofori-Tenkorang, and the Chief Actuary of SSNIT, Joseph Poku.

Mr. Poku in his submission disclosed that all Pensioners on the SSNIT Pension Payroll as of 31st December 2022 will have their monthly pension increased by a Fixed Rate of 19% plus a redistributed Flat Amount of GH¢73.58.

He indicated that the redistribution is a mechanism applied to the indexation rate to cushion low-earning pensioners in conformity with the solidarity principle of social security.

The SSNIT Scheme, like any other defined benefit scheme, pays pensions which mirror the earned salaries on which contributions were paid.

The effective increase in pensions would therefore range from 19.05% for the highest-earning pensioner to 43.53% for the lowest-earning pensioner.

Accordingly, the highest-earning Pensioner as of 31st December 2022 will receive GH¢ 169,725.89 per month in 2023. The lowest-earning pensioner as of 31st December 2022 will have his / her monthly pension increased from GH¢ 300 to GH¢ 430.58 in 2023.

Pensioners will be paid on the third Thursday of every month.

Dr. Ofori-Tenkorang, Director-General, said the increase was significant given the country’s current economic crisis.

He stated that the new indexation would cost Ghc850 million for the entire year.

He urged employers and SSNIT Scheme members who are affected by the revised maximum and minimum earnings to pay the correct contributions.

He said almost 70 percent of the SSNIT members would benefit from the increase.

Currently, there are about 234,000 legitimate pensioners as of December 31, 2022.

The Pensioners Association of Ghana described the increment as unexpected.

General Secretary Stephen Boakye said the figure was huge and SSNIT must be commended.