An internal exercise undertaken by the Social Security and National Insurance Trust (SSNIT) in 2018 has resulted in the deletion of over 6, 000 “ghost names” from SSNIT’s payroll of pension beneficiaries, saving the scheme over Gh¢40 million a year.
The exercise became necessary because the Trust had begun incurring a net outflow of funds in 2016 – payments made out to members was outstripping contributions being paid in by members – putting the scheme’s long term viability and sustainability at risk.
The verification was done to ensure that pension benefits paid to beneficiaries are legitimate and devoid of any leakages in the system. The exercise was part of concerted efforts to ensure financial sustainability aimed at returning the scheme to long term viability.
To sustain this concerted effort, officials of the Trust have already engaged with the Bank of Ghana (BoG) to issue a directive to banks to return all pension payments that are not claimed over a certain period of time and the banks are complying.
As a result of BoG’ directive, most of the banks are returning gratuity pension payments immediately it is proven that a pensioner has passed away – this having been one of the ways “ghost names” were used to defraud the scheme.
Speaking to the Goldstreet Business during the Organised Labour Pre-May Day Forum held in Accra on Wednesday, the Director General of SSNIT, Dr. John Ofori-Tenkorang reaffirmed that his outfit was committed to sustaining the viability of the Scheme.
“What is important is that we put systems in place to ensure that we are not paying pensions out to pensioners who do not exist”, he said.
In recent times, Organised Labour has been engaging SSNIT on pensions issues which are geared towards instituting a number of reforms in making pension benefits sustainable.
The event was organized on the theme Sustainable Pensions: The Role of Social Partners and was attended by all groups under Organised Labour’s umbrella. It was aimed at looking for sustainable ways to making pension funds sustainable.
In 2018, SSNIT paid close to Gh¢2.5 billion on benefit payments. Currently, over Gh¢200 million a month is spent on funding pension payments to the over 200,000 pension beneficiaries on SSNIT’s payroll as well as Gh¢1 million spent on invalidity pension. Invalidity pension payment is for people who cannot work because of a long-term illness or disability and they are covered by the Scheme after they have contributed for only 12 months.
By Dundas Whigham