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23.11.2007 Business & Finance

SSNIT to pursue debtors

SSNIT to pursue debtors

The Social Security and National Insurance Trust (SSNIT) is to aggressively pursue and prosecute defaulting employers to retrieve over 430 billion cedis contribution arrears.

Mr John Saka Addo, Chairman of Board of Directors of the Trust, said in Accra on Thursday that "While we have enjoyed the co-operation of our member employers in terms of compliance, there is still a sizeable number who have not regularly met their statutory obligations," he said.

According to Mr Addo, the top 100 delinquent enterprises accounted for over ¢247 billion representing 57.55 percent of the total indebtedness.

Mr Addo, who was speaking at the Third Stakeholders' Forum of the Trust, said they were engaged in discussions with the Accountant-General in respect of the arrears owed by state-owned institutions.

He said since the Trust resolved to prosecute defaulters, an amount of ¢61.31 billion had been recovered.

Mr Addo, however, said last year witnessed a phenomenal growth in contributions with the Trust collecting an amount of ¢2,868 billion, up by 50.47 percent on the ¢1,906 billion collected in 2005.

He attributed that to the receipt of outstanding contributions for previous years due from some key stakeholders.

The Chairman said the Trust also recorded a positive real return of 4.3 percent in 2006, showing a recovery from the -8.4 percent real return made in 2005.

"This improved performance was due partly to gains from the revaluation of some major equity investments such as Ecobank Transitional Incorporated and partly to improved dividend and interest income."

He announced that the Government White Paper and the new pension reforms had come out and the Trust was co-operating with a Pension Reform Implementation Committee in its work to craft the necessary legislation to give legal backing to the recommended reforms.

Mr Kwasi Osei, Director-General of the Trust, said contributing membership grew from 1,144,493 to 1,211,620 and the year also recorded 90,906 new members and 23,779 withdrawals.

On pensions, he said the Trust processed 18,510 applications in 2006 for various benefits showing 10.18 per cent increase over the 2005 figure of 16,800.

"The total value of benefits processed was ¢798.71 billion as compared to ¢630.24 billion in 2005, showing an increase of 26.73 percent," he said.

He said out of the total benefit paid in 2006, old age/invalidity pension and survivors' benefits accounted for ¢621.91 billion and ¢140.99 billion respectively. They also paid ¢35.81 billion for old age lump sum/refund.

Mr Osei said Student Loan recoveries had continued to improve over the last three years and they had recovered ¢236.6 billion, representing 15.84 percent of the amount due, through outright payments, social security contributions and deductions from the guarantors' benefits.

"We are recovering at the rate of five billion cedis monthly."

Most stakeholders, especially the pensioners, were worried about the delay in processing their pension documents and receipt of their entitlements.

They urged the Trust to put in more "realistic mechanisms" to correct the existing procedures, which they said, were very cumbersome.