With the current interpretation of the pension law by the Social Security National Insurance Trust (SSNIT), the Trade Union Congress (TUC) has indicated that it has resulted in the workers being worse off than hitherto with regards to their pensions.
Speaking at the presentation of an organized Labour Committee report on Pensions, Dr. Justice Yankson, Chairman of the Committee indicated that SSNIT pensions are low due to the misinterpretation of the pension law.
“The wrong interpretation (of) which constitutes annual salary, 36 months, insertion of early retirement reduction factor and annuity factor on lump sum are strange to the PNDC Law 247,” Dr. Yankson said.
Further to this beginning from January 2020, the first batch of workers who are going to benefit from the three tier arrangement, and who are meant to receive lump sum paid to them from the Tier 2, would have the new system taking effect.
However, the Tier 2 lump sum payment which should take off in 2020 is likely to face some impediment, since some of their funds were invested only some few years ago.
In January, 2010 the country was ushered into a new era of pension’s administration with the commencement of the 3-Tier Pension Scheme which was established by the National Pensions Act, 2008 (Act 766) which was passed in 2008.
The National Pensions Regulatory Authority (NPRA) as at June, 2018 had completed the transfer of funds in the Temporary Pensions Fund Account (TPFA)1 – which had housed contributions from workers to the second tier, invested by the Bank of Ghana for the period January 2010 to December 2013 – to the Sankofa Master Trust Scheme.
The Authority is now in the process of transferring the TPFA 3 funds for the period January 2014 to date to the Sankofa Scheme which manages contributions of workers who are not members of any particular licensed scheme chosen by them or their employers.
Going forward General Trust Ltd. is expected pay Tier 2 benefits to all contributors whose funds are in the TPFAs 1 and 3.
General Trust has also registered a Public Sector Workers (PSW) Master Scheme to manage contributions of sub-vented organizations which do not draw their salaries from Controller and Accountant Generals’ Department.
By Joshua W. Amlanu