27.09.2004 General News

Presidential Commission on Pensions begins sittings

27.09.2004 LISTEN

Accra, Sept. 27, GNA - The inefficiencies of the Social Security and the National Insurance Trust (SSNIT), as a pension scheme for Ghanaian workers took centre stage on the first day of the sitting of the Presidential Commission on Pensions in Accra on Monday.

Speakers contended that computation of the existing SSNIT pension did not provide adequate security for retired workers of Ghana and called for the benefits of the SSNIT scheme to be made attractive if the Law obliged workers to contribute to it.

Mr Kingsley Asare, Administrative Secretary of the Industrial and Commercial Workers Union (ICU), speaking on behalf of the Union's Secretary General Mr Napoleon Kpoh, said there were many high yielding life assurance policies out there, and an attractive SSNIT scheme would put the minds of workers at ease.

He suggested the minimum pension payment to be based on 100 per cent of the average annual salary for the best three years of a member's working life instead of the current 50 per cent.

Mr Asare said the 100 per cent could be paid without undermining the Scheme if the SSNIT made prudent investments with members' contributions compared to the less attractive ones it had reportedly been involved in. He said the fact that some Teachers were still under the CAP 30 Pension Scheme, which paid higher pension benefits, while Teachers under the SSNIT Pension Scheme received lower benefits provided a recipe for dissension.

This accounted for the recent agitation by some Teachers and Civil Servants for their return to CAP 30.

The British Government established CAP 30 in 1946 for Pensionable Officers in the Civil Service and members of the Armed Forces in the former British West African Colonies including the former Gold Coast, now Ghana.

Today the CAP 30 embraces all the security agencies, some Civil Servants and Teachers.

Mr Asare made a seven-point suggestion, which the ICU urged the Commission to ensure that identical class of workers were placed under the same pension scheme, increased lump sum payment and the reduced pension to reflect the total enhanced pension.

Also, unemployment benefit should be paid to retrenched workers to support them for the period that they had lost regular income until they got a new job.

Mr Asare also called for a de-linking of SSNIT from funding students loan scheme considering the rate of default in payment, and instead the Ghana Education Trust Fund (GETFund) be used to fund the students' loan scheme.

Mr Emmanuel Ashley, National Vice-Chairman of Ghana Government Pensioners Association (GGPA), said the Government must contribute the 12 and a half per cent on behalf of workers into the Consolidated Fund. Also a percentage of the tax paid by members should also be paid into the Consolidated Fund, but Government should keep its hand off the Fund. Mr Ashley urged Government to establish another fund, be it Consolidated Fund II for its developments, and as a matter of urgency peg workers pay at one-pound sterling, since it was the Colonial the Government of Britain, which introduced the CAP 30.

Mr Samuel Ababio, National Secretary of the GGAP, said the SSNIT Scheme Board must invest in high yielding stocks.

He said but for the existence of the GGAP, the list of names of pensioners would have been bloated by half, and added that there were still ghost names of pensioners on the payroll of the Controller and Accountant General's Department, which the Department attributed to a faulty machine.

Mr Thomas Ango Bediako, Co-ordinator of Education International, who is the Chairman of the nine-member Commission, in an opening statement gave an assurance that the Commission would ensure that its final report was guided by best practices in developing and emerging countries and conformed with international conventions and norms.

Other members of the Commission, established by President John Agyekum Kufuor on July 1, 2004 and inaugurated by him on August 4, 2004 are Captain Joel Sowu, Mr Martin Eson-Benjamin, Mr Andrews Asamoah and Mrs Irene Wontumi.

The others are Ms Josephine Amoah, Chief Musa Adam, Mr Austin Gamey and Mr Daniel Aidoo Mensah.

The objective of the Commission, which would work with the Public Sector Reform Advisory Group, is to come up with recommendations for a pension scheme or schemes that would ensure retirement income security for Ghanaian workers with special reference to the Public Sector. It would submit an interim report, giving reasons for the recommendations, to the President not later than November 30, 2004.

Mr Bediako said the Commission intended to have public sittings in Accra and would thereafter travel in October to Wa, Bolgatanga, Tamale, Sunyani, Kumasi, Takoradi, Cape Coast, Ho and Koforidua.

He said the Commission would also focus seriously on the management and investment of existing and future pension schemes.

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