Published on 30 August, 2021.
The Director-General of the Social Security and National Insurance Trust (SSNIT), Dr John Ofori-Tenkorang, has urged labour unions to engage employers to consider consolidating the salaries of their members to guarantee better pensions when they retire.
He made this call at the 11thQuadrennial Delegates Conference of the Industrial and Commercial Workers’ Union (ICU), Ghana held at the University of Professional Studies, Accra (UPSA).
Addressing delegates during the three-day conference, Dr Ofori-Tenkorang said people always talked about how long they have contributed to the Scheme but remained silent on the monthly salaries that were used in determining their contributions.
“The fact is that the salaries on which one contributes, determines the pension that is paid. In short, the factors that determine how much you receive as benefits depend on YOU – the Member,” he said.
The SSNIT Boss explained that the 11percent contribution of Members guarantees up to a maximum of 60percent of the average of their three years’ best annual salaries, depending on the number of years contributed.
He further stated that the majority of SSNIT contributors have low basic salaries and this affects their pensions when they eventually retire.
“Over 80% of workers in Ghana insure salaries of GHS 2,500.00 or less. So, if you, in this room, represent all workers in Ghana, it means 80% are contributing GHS 275 or less each month. And 95.5% of pensioners are paid GHS 2,500 or less each month. Only 5.3% of workers in Ghana pay a premium or contribution on salaries of GHS5,000 or more”, he said.
Should this situation remain unchanged, 80percent of retirees will receive a pension of GHS1,500 or less in the future.
“This simply means if the contributions records of workers in active service do not significantly improve, then the reality of your pension payments may not be different from those who are presently on pension. I encourage you to engage your employers to consider consolidating your salaries. This will guarantee you a better pension when you retire,” he added.
Dr Ofori-Tenkorang, said a good way to avoid being shocked about the benefits they receive at retirement is for Members to track and be sure employers are paying contributions regularly and on the correct salaries.