Approval for SSNIT pension reforms expected shortly

Discussions and consultations concerning a proposal put forward by the external Actuaries on the Social Security and National Insurance Trust (SSNIT) scheme who recommended a 19.2 percent contribution rate to replace the existing 11 percent rate being implemented are expected to be concluded early this year.

The move is part of a number of amendments and reforms that are being considered for implementation in the National Pension Act, 2008 (Act 766) by sector Administrators – National Pension Regulatory Authority (NPRA) and SSNIT in consultation with the Trades Union Congress (TUC).

Importantly, the actuarial evaluation report insists that the 19.2 percent rate is expected to improve workers’ life expectancy after retirement as well as ensure the sustainability of the pension funds.

Already, management of the Trust has put together a list of amendments and reforms needed to be considered to enable the SSNIT pension scheme to become more robust and sustainable in order to enhance the purchasing power of pensioners in the country.

Speaking with the Goldstreet Business, Director General of the Trust, Dr. John Ofori-Tenkorang noted that sooner rather than later, SSNIT will begin the final deliberations and consultations to see which way to go.

“Every three years, as per the statute, we need to have external actuaries coming to conduct health check on the SSNIT scheme. Issues related to contribution rate; retirement age among other reforms have been raised as areas within which we could consider for reforms”, he explained

Reforms

The reforms have become necessary because some gaps – with regards to the prevailing law governing the operations of the pension scheme – have been identified by the Administrators and TUC, hence the need to institute measures to curtail them.

According to the TUC, it has identified some weaknesses in the SSNIT scheme with regards to inadequate pension benefits and that must be addressed, stressing that the weaknesses in the system could be attributed to inherent flaws in the legislation governing the social policy to recognize the need for the vulnerable on the scheme.