Amendment of Pensions Act to guarantee decent retirement — SSNIT
The Social Security and National Insurance Trust (SSNIT) has explained that the amendment of the National Pensions Act, 2008 (Act 766) is to guarantee decent life after retirement.
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The General Manager, General Council Division of SSNIT, Mr Peter Hayibor, who gave the explanation, said it was also to ensure that workers were not worse off on retirement, “so, the amendment that was made in December 2014 is to reduce the age exemption from 55 years to 50 years so that all those who were 50 years and above as at January 2010 will all be moved under the old Social Security Act.”
Speaking at a colloquium on the theme, “An amendment to the National Pensions Act, 2008 (Act 766), aftermath and expectations, he said as a result of the amendment of the Act, 413,000 workers would be brought back into the old pensions scheme.
Purpose
The colloquium was organised by the Ghana National Association of Teachers (GNAT) and attended by its regional executives.
The purpose of the programme was to educate the executives on the aftermath and expectations of the amendment of the Act to enable them to explain to their members.
Mr Hayibor further indicated that those who were below 55 years were worse off “if we computed their pension using the formula under Act 766, because they have lost the lump sum component that they would have earned if they were to be under the old law.”
Formula
On the formula for the computation of pensions, he said there was a mistake and the amendment sought to correct it by providing that a worker was due for pension if he worked continuously for 15 years instead of the original 20 years.
He said formerly, for a SSNIT contributor to qualify for pension, he was to contribute for 20 years, representing 50 per cent “and then every additional year, 1.5 per cent up to a maximum of 50 per cent that was responsible for the payment of the total 100 per cent pension. The 25 per cent lump sum was paid and 75 per cent paid monthly until the beneficiary died.”
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With the new law, Mr Hayibor explained that SSNIT was no longer going to pay the 25 per cent lump sum, which was now ceded to the second tier and, therefore, there was the need to correct the formula of the computation.
Foreign workers
He said the amendment would also ensure that foreigners who worked in the country but had to leave did not need to rely on the monthly pension allowance, “and that is why the immigration benefit was introduced so that the worker’s benefit is paid in bulk to him.”
Retired workers
Mr Hayibor said averagely, over 1,000 people went on retirement every month and currently there were close to over 50,000 pensioners that were paid every month.
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