Open letter to SSNIT, NPRA and all contributors under Act 766 of 2008

It has been six years since the implementation of the Three Tier Pension Scheme Act 766 of 2008. When is Social Security and National Insurance Trust (SSNIT) going to transfer the four per cent (lump sum portion or accrued contributions) of Act 766 contributors to their respective Tier ‘’2’’ fund managers for prudent investments towards enhanced retirement benefit?

The introduction of the Three Tier Pension Scheme sought to reward contributors with benefit enhancement clauses enshrined in Act 766. The implementation of Act 766 of 2008 on January 1, 2010 (until the recent amendment of Act 883) sought to categorise members into two, namely; those who are 55 years and above and remained on PNDCL 247, while those 54 years and below were rolled onto ACT 766.

Consequently, under PNDCL 247 (for the old SSNIT members), there was the option of accessing a lump sum benefit in addition to regular monthly pension from SSNIT. However, contributors under Act 766 will only access monthly pension from SSNIT, since the Tier ‘2’ (lump sum) will be paid by their respective private fund managers.

The question then is, what happens to all the previous lump sum component (four per cent) contributions that had gone to SSNIT for all those years before the implementation of the New Pension Law Act 766?

Section 94 sub-section (d) of ACT 766 states….“Accrued or past service or past credits earned by every contributor to whom the new scheme applies in respect of the 25 per cent lump sum benefit shall have the lump sum determined by a formula agreed between the Pension Reform Implementation Committee and the Trust based on actuarial assessment.”

It has been six years since the implementation of Act 766 and one may ask, where is the Pensions Reform Implementation Committee? What is the National Pensions Regulatory Authority (NPRA) doing in this direction? When is SSNIT going to transfer those monies to contributors’ duly appointed Tier “2” fund managers for prudent investments towards lump sum payment? Who is watching the watchman (SSNIT)? For how long is SSNIT going to be allowed to sit on workers’ four per cent (past credit or lump sum portion).

It is about time Ghanaian workers asked the tough and critical questions for institutions mandated to protect workers interest to do so without fear or favour. Is it not amazing and interesting to note that SSNIT, which has pretended to be in oblivion regarding the refund of “Past credits” or “Accrued lump sum” contributions, was so quick to boldly insert a clause in the recent Amendment ACT 883 of 2014, among other things stating……

Section 60 of Act 766 amended; section 2 subsection (4)…“ Where a worker is exempted under subsection (1) but has already contributed to the second-tier scheme, the contributions and returns of the worker under the second-tier scheme shall be refunded to the Trust."

What is good for the goose, they say is good for the gander. If SSNIT is so much interested in the four per cent contributions of those handful contributors who have just been rolled back onto PNDCL 247, then with the same speed and alacrity, they should refund the four per cent (past credit or accrued lump sum) of all Act 766 contributors to their duly appointed Tier “2” fund managers not even talking about accrued interest earned.

I have personally witnessed the computed pension benefits for some Act 766 pensioners who retired under reduced pension, and you will be amazed to see the paltry sums given as ‘’compensation’’ under the guise of “Past credit”. Interestingly, SSNIT officials are not even willing to disclose computation basis for that “Past credit”. The question is, why? Don’t Ghanaian workers deserve better than this? It is about time we stood up and demanded what is rightfully ours.

Observing from afar, unfolding events in the management and administration of pensions in Ghana now, I dare say that if care is not taken, SSNIT will clandestinely use amendments upon amendments as a “Working tool” to calculatedly erode all the gains and benefits that the Three Tier Pension Scheme of Act 766 sought to give contributors.

It is on this premise that the NPRA, which is the institution mandated by law as the regulator of the Pensions industry, will have to be at the forefront of ensuring strict compliance with the provisions in the law.

NPRA must be seen to be interested in protecting the interest of contributors in order to ensure that the enhanced benefit packages enshrined in the New Pension Scheme towards the realisation of retirement safety and security are not compromised.