GH¢200 Million for an NPRA Building: But What about Ghana's Pensioners?

There are some questions about public expenditure that should never be dismissed as mere political criticism. They are questions about priorities. They are questions about value for money. And, above all, they are questions about whether public institutions are deploying scarce resources in ways that produce the greatest possible benefit for the people they were established to serve. The revelation before Parliament's Public Accounts Committee that the National Pensions Regulatory Authority (NPRA) has accessed GH¢200 million towards the second phase of its headquarters project therefore deserves much more public attention than it has so far received. According to reports from the committee hearing, NPRA originally planned to raise GH¢500 million for the project and had accessed GH¢200 million in 2025. The proposed second phase is a ten-storey building which NPRA says will accommodate, among other things, a pensions college and a national pensions data bank. The explanation may sound reasonable on the surface. But for hundreds of thousands of Ghanaian pensioners struggling to survive on very modest monthly pensions, it inevitably raises another question: How much of Ghana's pension resources should be committed to buildings, and how much should be devoted to improving the lives of the people whose retirement security the pension system is supposed to protect? That question deserves a detailed, factual and independent answer.

What Exactly is Being Built?
The Public Accounts Committee has reportedly questioned the necessity of the additional building and how NPRA intends to repay the financing. NPRA's answer, as reported, is that repayment will come from its own resources. That answer itself requires clarification.

• What exactly are NPRA's "own resources"?
• What are the sources of those resources?
• Are they fees and levies paid by pension fund managers, trustees, custodians and other participants in the pension industry?
• What portion of NPRA's annual income is being committed to servicing the project?
• What is the interest rate on the GH¢200 million?
• Over how many years will it be repaid?
• And what will the final cost be after interest and other financing charges?

These are not hostile questions. They are basic accountability questions concerning a project involving hundreds of millions of cedis. If the original intention was to raise GH¢500 million, Parliament and the public should also know whether GH¢500 million represents the total construction cost, the borrowing requirement, or the total project financing envelope. The difference matters.

What is a "Pensions College"?
Perhaps the most intriguing component of the proposal is the Pensions College.

• What exactly is a Pensions College?
• Is it intended to be a university-level institution?
• A professional training center?
• A certification center for pension trustees?
• A research institution?
• Or simply a training facility for NPRA and pension-industry personnel?

There is nothing inherently wrong with establishing a specialized institution for pension education and professional training. Indeed, Ghana's increasingly complex pension system requires people with appropriate knowledge and professional skills.

But there is a question of efficiency. NPRA has previously used existing institutions for pension-related training. The Authority's 2016 annual report, for example, referred to the Trustee Training Council and identified institutions providing training for pension trustees. If existing universities, professional institutions and training organizations can provide some or all of these services, Parliament should ask why a substantial new physical facility is necessary. And if NPRA has now concluded that Ghana needs a dedicated national Pensions College,

1. Where is the feasibility study?
2. How many students are expected annually?
3. How many courses will be offered?
4. Who will teach them?
5. What will it cost to operate the college each year?
6. Will it charge fees?
7. How much revenue is expected?
8. How many people in Ghana's pension industry require this specialized training?
9. Most importantly, what is the expected return on the investment?

A "Pensions College" should not become simply another impressive building bearing the name of a public institution. It must have a demonstrable purpose and measurable value.

The National Pensions Data Bank is Different

The proposed national pensions data bank is easier to understand because NPRA has a clear statutory responsibility in this area. The National Pensions Act, 2008 (Act 766) gives NPRA responsibility for research and maintaining a national data bank on pension matters. A reliable national pensions database is extremely important. Ghana needs accurate information about contributors, pension schemes, pension fund managers, trustees, custodians, beneficiaries, contributions, benefits and other aspects of the pension system. Good data can improve regulation. It can help identify gaps in pension coverage. It can expose weaknesses in the system. It can improve planning. It can also help government understand the real condition of Ghana's retirement-income system.

But a national data bank does not automatically explain the need for a ten-storey building. A modern data system is primarily a technological and institutional infrastructure project. It requires secure databases, software, connectivity, cybersecurity, backup systems, disaster recovery, interoperability and competent personnel. Parliament should therefore ask NPRA to provide a detailed breakdown showing exactly how much of the project cost relates to the data bank and how much relates to conventional office accommodation. That distinction is important. Is the building really necessary? This is probably the central question.

If NPRA has outgrown its existing headquarters, there may be a perfectly reasonable case for expansion. Public institutions need appropriate offices. They need meeting rooms. They need technology infrastructure. They need training facilities. They need secure records and other facilities. Nobody should argue that public institutions must operate permanently from inadequate premises. But there is a difference between needing additional accommodation and demonstrating that a GH¢500 million project is the most economical way of obtaining it. That is where Parliament's scrutiny becomes important.

Could the Pensions College operate from an existing educational institution? Could the national data bank be developed using existing government digital infrastructure? Could NPRA lease additional office space rather than construct a massive new building? Could the project be implemented in phases? Could the training component be outsourced or operated through partnerships with universities and professional bodies? Could a smaller building meet NPRA's actual needs? These alternatives should be examined before hundreds of millions of cedis are committed.

The Pensioner Must not Disappear from the Equation

There is an even bigger issue. Ghana's pension debate is no longer simply about whether people receive a pension. It is about whether the pension is adequate to enable a retired person to live with dignity. For many pensioners, the answer remains deeply troubling. Food prices have risen. Electricity and water bills have increased.

Transport costs remain burdensome. Medicines and healthcare can consume a significant portion of a pensioner's income. Rent and household expenses do not disappear when someone retires. And many pensioners have children and grandchildren who continue to depend on them. For a pensioner receiving a relatively small monthly pension, even a modest increase can make a meaningful difference.

Against this background, every major expenditure within the pension architecture deserves to be examined through one simple question: How does this expenditure ultimately strengthen the retirement security of Ghanaians? The answer does not necessarily have to be "by increasing monthly pensions." Regulation is important. Supervision is important. Data is important. Training is important. Institutional capacity is important. But all these things are ultimately means to an end. The end is a stronger pension system and better retirement security.

Parliament Should Follow the Money

The Public Accounts Committee has already started asking questions. It should go further. This is not a call for Parliament to cancel the project. It is a call for Parliament to establish the facts. The complete financial and procurement documentation should be placed before the appropriate oversight institutions. That should include the original feasibility study, project justification, architectural designs, bill of quantities, cost estimates, financing agreement, interest rate, repayment schedule, contractor information, consultant fees, payments already made and any variations to the original contract. Parliament should also establish why the project is being financed in the manner chosen.

If GH¢200 million has already been accessed, where exactly is the money?

1. How much has been spent?
2. How much remains?
3. What assets have been created?
4. What liabilities have been incurred?
5. What will the project eventually cost the public purse or the pension industry?

These are straightforward accountability questions.

What about Procurement?
There is another matter that deserves careful examination. Reports from Ghana's electronic procurement system indicate that elements of the project procurement have involved single-source procedures. That does not, by itself, establish wrongdoing. Ghana's procurement legislation permits single-source procurement under specified circumstances. But the larger the project, the greater the need for transparency. A project involving hundreds of millions of cedis should have a clear explanation for why the procurement method was chosen.

Parliament should therefore ask:

1. Why was the procurement method selected?
2. What circumstances justified it?
3. Who approved it?
4. Were alternative procurement methods considered?
5. Was the price independently tested against market rates?
6. Were there competitive benchmarks?
7. Were independent quantity surveyors involved?
8. And are there safeguards against cost escalation?

These questions are particularly important because construction projects can become considerably more expensive through variations, extensions, consultancy costs, financing costs and other additions.

A Forensic Audit?
Calls for a forensic audit should therefore not be dismissed simply because there is no evidence at present of wrongdoing. A forensic audit is most useful when its purpose is clearly defined. In this case, an independent review could establish whether:

1. The project was properly conceived and approved;
2. The procurement process complied with the law;
3. The project cost represents value for money;
4. The financing arrangement is financially prudent;
5. Payments correspond with actual work completed;
6. Variations were justified;
7. Consultancy and professional fees were reasonable;
8. The proposed pensions college is economically justified; and
9. The national pensions data bank genuinely requires the proposed physical infrastructure.

If everything is in order, such an audit would actually strengthen NPRA's position. It would demonstrate to pensioners and contributors that the Authority has nothing to hide.

Pension Adequacy Must Remain the Priority

There is a danger in allowing institutional expansion to become an end in itself. A regulator can have a beautiful headquarters, sophisticated offices, conference rooms and training facilities and still fail to address the fundamental concerns of the people whose interests it is supposed to protect. The pension system should therefore always be judged by its outcomes.

1. Are pensioners receiving adequate retirement income?
2. Are pension benefits keeping pace with the cost of living?
3. Are pension funds being invested prudently?
4. Are contributors receiving value for their contributions?
5. Are pension schemes expanding into the informal sector?
6. Are administrative costs reasonable?
7. Are investment losses properly investigated?
8. Are pension funds protected from unnecessary risks?
9. Are pensioners adequately represented in decisions affecting their retirement security?
10. And is the regulatory system itself operating economically

My Thoughts: Ghana Needs Pension Institutions that Inspire Confidence

There is nothing wrong with NPRA wanting a modern headquarters. There is nothing wrong with professional training. There is nothing wrong with a national pensions data bank. Indeed, all three may be necessary. But necessity must be demonstrated, cost must be justified, procurement must be transparent and value for money must be established. The fact that NPRA says it will repay the financing from its own resources should not end the discussion. It should begin it.

1. Where did those resources come from?
2. Who ultimately provides them?
3. What competing uses were considered?
4. And what will Ghana's pensioners gain from the investment?

Those are questions that deserve clear answers. Ghanaian pensioners have spent decades contributing to the country's economy. Many of them now live on pensions that barely cover their essential needs. They should not have to wonder whether the institutions established to protect their retirement security are giving sufficient attention to the adequacy of their pensions while committing hundreds of millions of cedis to infrastructure. The issue is therefore not "building versus pensioners." It is about priorities, proportionality, transparency and value for money.

If NPRA can demonstrate that the ten-storey building, the pensions college and the national pensions data bank are all necessary, economically justified and financially prudent, the public should accept the explanation. But if GH¢200 million has already been accessed and the ultimate project cost could reach GH¢500 million, the public deserves to see the evidence. And perhaps the most important question Parliament can ask is a very simple one: Before we build another ten-storey pension institution, have we done everything possible to build a pension system in which Ghana's elderly can retire with dignity?

FUSEINI ABDULAI BRAIMAH
+233208282575 / +233550558008
[email protected]