Pension funds intact — Senanu
The National Pensions Regulatory Authority (NPRA) has given an assurance that funds contributed into the tier-two pensions fund are intact, not misused but being invested at the Bank of Ghana (BoG).
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The Temporary Pensions Fund Account (TPFA) at the Central Bank into which the collections are kept had accrued more than GH¢1.2 billion as of December 17, 2013 which had been invested in government treasury bills, the acting Chief Executive Officer of the NPRA, Mr Laud A. K. Senanu, told the Daily Graphic.
He said the contributions which had been accruing since January 2010 represented collections made on behalf of the authority by the Social Security and National Insurance Trust (SSNIT) and those transmitted by the Controller and Accountant-General’s Department (CAGD).
Mr Senanu, who assumed office last month following the appointment of the former acting Chief Executive, Mr Sam Pee Yalley, as an ambassador-designate, said the authority received bi-weekly statements from the BoG on the status of investments.
He added that the authority was working assiduously to clean up data submitted to it to pave the way for independent auditing and subsequent transfers to pension fund managers and corporate trustees.
For the transfers to take off smoothly, a number of things need to be achieved.
First, the data provided by the collectors should reconcile with what shows in the TPFA at the BoG. Secondly, employers need to register their members and registered schemes with trustees.
Analysis of data provided by SSNIT for the period January, 2010 to October, 2013 showed the number of registered active establishments as 45,269, with almost 1.16 million members.
However, only 4,321 employer schemes have been registered with corporate trustees.
This means that a lot more employers have to register their schemes to enable their trustees to access the funds when they get transferred.
Fund Administration
Since the NPRA has oversight responsibility over the management of the funds, it appointed a fund administrator, after a competitive tender process, for services including collations, analyses and reconciliation of contributions and preparation of reports.
According to the NPRA, although five fund administrators were initially appointed, FirstBanC Financial Services Ltd was the only company still engaged in the data and records management of the second-tier funds.
Mr Senanu declined to comment on the take-over of Merchant Bank because the matter was before the court but made it clear that FirstBanC had not squandered the fund, stressing, “They have no physical access to it; they only handle the data and clerical aspects of the fund.”
The policy think-tank, IMANI Ghana, has alleged that the tier two pension contributions ‘may’ have been used in financing the acquisition of Merchant Bank by Fortiz P.E.
In an alert to the President, Mr John Dramani Mahama, headed, “How GH¢1.2 billion ($500m) tier two pension contributions may be involved in the controversial Fortiz-Merchant Bank sale saga”, IMANI alleged that “the Bank of Ghana has made some of the TPFA Tier 2 pension funds being held at the BoG available to Fortiz to purchase Merchant Bank”.
Among other things, IMANI’s argument is premised on the fact that one Mr Mawuli Hedo is a director of both Fortiz, which purchased Merchant Bank in which SSNIT holds a majority stake, and FirstBanC, the scheme administrator of the TPFA being held at the BoG.
IMANI considers the two institutions common denominators in the Fortiz-Merchant Bank saga.
It also believes the use of tier two pension contributions is possible because “SSNIT has been the collection vehicle of the Tier two since January, 2010 when the implementation of the three-tiered pension system started”.
However, Mr Senanu explained that SSNIT transmitted all collections directly into a TPFA account at the BoG and provided them with data on the status of the contributors and the amounts transferred.
FirstBanC handled data and records related to activities only and did not have any access to the funds transferred to the BoG, he said.
Mr Senanu said while the authority worked tirelessly on the data to enable it to transfer them to the trustees of registered schemes, its doors were open to corporate trustees and other stakeholders which wanted to engage it.