Accra, Dec. 23, GNA - The Social Security and National Insurance Trust (SSNIT) on Friday announced an increase in pensions payment by an average of 20 per cent as at the end of December 2005.
The increases, which range from 15 per cent for those at the upper end to 30.8 per cent for those at the lower end, take effect from January 2006 and apply to only persons currently on pension. With the review, pensions will range from 150,000 to over 70 million a month.
A statement from SSNIT signed by Mr Kweku Osei Bimpong, Head of Public Affairs, said in line with the solidarity principle of social insurance, the average increase will be distributed through the payment of a flat amount of 19,957.31 cedis and 15 per cent increase on an existing pension.
The annual review in pensions, the statement explained, was in line with the Social Security Law PNDC Law 247.
In this direction SSNIT since 1992 had reviewed pensions based on the average increase in salaries of contributions during the previous year.
According to the statement, the general salary levels coupled with the fact that some employers understate the earnings of their employees continued to impact adversely on the pensions paid.
"On record, there are contributors who declare salaries far below the prevailing minimum wage," the statement added. The statement, therefore, urged employers not to under-declare the earnings of their employees in order to help SSNIT solve the problem of low minimum pension.
"Employees should also be alert and not collude with their employers to under-declare as it has been in some cases." The statement further advised employers to consolidate the basic earnings and allowances of their employees and to contribute on the consolidated earnings to ensure higher pension at retirement.
"For SSNIT to sustain meaningful guaranteed pensions, employers who pay contributions on behalf of contributors are expected to contribute on at least the prevailing minimum wage," the statement added.