Gov’t settles GHS 2.33bn pension contributions for public sector workers it defaulted on

contributions for public sector workers it defaulted on

The Government has made complete payment for pension contributions for public sector workers which it defaulted on for a period of eight (8) months.

The complete payment of the pension contributions for public sector workers by the Government was disclosed by the Chief Executive Officer (CEO) of the National Pensions Regulatory Authority (NPRA) Hayford Attah Krufi.

The outstanding arrears in pension contributions for public sector workers by the Government, he also disclosed, amounted to some GHS 2.33bn.

“Government has cleared the outstanding arrears in pension contributions for public sector workers as of August 2023, and the amount settled by Government is to the tune of GHS 2.33bn (sic),” he noted.

Background 

Reports indicated that the government had defaulted on its pension contribution payments for public sector workers, spanning the period from October 2022 to May 2023. This lapse in meeting financial obligations raised significant concerns about the financial security of public sector employees and the government’s commitment to fulfilling its pension obligations.

Specifically, the government failed to fulfill its commitments regarding both the 13% Tier 1 and the 5% Tier 2 pension contributions for public sector workers during the aforementioned eight-month period. While some payments were made in March 2023, it came to light that these payments were only intended to cover contributions up to September 2022, leaving a substantial deficit for the subsequent months.

The failure to make timely and complete pension contributions left public sector employees in a precarious position, as pension funds play a crucial role in ensuring financial stability during retirement. Such lapses can have far-reaching consequences for the financial well-being of retirees and their families.

In response to this alarming situation, the National Pensions Regulatory Authority indicated its intention to engage in continued negotiations with the government. The primary objective of these negotiations was to address the outstanding pension contributions and establish a mechanism for the punctual payment of future contributions. The step was critical to restoring confidence in the pension system and providing public sector employees with the financial security they rightfully deserve.

Source: Norvanreports