SSNIT calculation of imperfect benefits – TUC report

Company News of Thursday, March 21, 2019

Source: Graphic.com.gh

2019-03-21

An eight-member committee set up by the Trades Union Congress (TU) to review the current pension scheme has identified gaps in the calculation of pension benefits by the Social Security and National Insurance Fund ( SSNIT) for its contributors.

Incorrect calculations affect how the SSNIT recognizes annual wages, the determination of annuities (regular benefits) and the reduction of early retirement.

The report accuses SSNIT of "misinterpreting what constitutes an annual salary (36 months), a factor of reduction of early retirement and a rent factor on a lump sum", describing it as "strange under PNCC Law 247 and must be abolished. "

The report also noted that "the SSNIT pension is low because the SSNIT misinterpreted the pension law, which resulted in low pension payments, thus worsening the situation of contributors".

The commission submitted its report Tuesday to the leadership of the trade union movement for discussion.

The committee's mandate was to examine the issue of the annual salary, annuity factor and early retirement reduction factor implemented by the SSNIT.

Low wages

Presenting the report at a forum titled "Forum of Union Leaders on Pensions", a committee member, Mr. Joseph King Adu, found a reason to refute the idea that low wages workers contributors to the SSNIT were behind derisory allowances and lump sums. retirees received.

"The committee believes that it is a bad perception. The SSNIT has made this perception over the years to make people believe that only low wages are the cause of low pensions. The committee believes that it is rather because of the misapplication and misinterpretation of the law by the SSNIT to the detriment of the members, "he said.

Committee position

Mr. Adu stated that the committee was of the opinion that the SSNIT did not apply the law governing the pension plan and appealed to the National Pension Regulatory Authority (NPRA) to coerce the senior pension fund manager to "do what's right".

"So far, the SSNIT has not been able to produce the legal basis for the definition of annual salary, the early retirement reduction factor and the deduction of annuity." They only claim that they are actuarial principles.

"We recommend that NPRA force the SSNIT to calculate pensions strictly based on the law and nothing else," he told union leadership.

Mr. Adu stated that the SSNIT claimed that his way of reporting the annual salary (using the best of the last three years, 36 months) was favorable to the donor, but the committee thought otherwise. It was wrong.

With respect to annuity, monthly pension benefits paid to contributors, Mr. Adu stated that the committee was of the view that the lump sum annuity applied to reduced benefits and not retirement benefits.

A member may exercise the option of a partial lump sum payment corresponding to 25% of his pension and a reduced pension based on the average annual salary of the best three years of a member over the course of a year. of his active life.

The pension is a big thing

Anthony Yaw Baah, Secretary-General of the TUC, said about the report that the pension plan was a major issue and that it would figure prominently in this year's Workers' Day celebration to draw the company's attention. the authorities' attention to the fact that "this is our life. "

He added that the TUC took the issue seriously, which is why it brought together the three main leaders of all organized labor groups to discuss the issue impartially to determine the way forward.

Dr. Baah congratulated the Friedrich Ebert Stiftung (FES), a foundation supported by the German government, for sponsoring the union to organize the forum to create a platform for leaders to discuss final report of the committee.

The FES program coordinator, Mr. Ebow Mensah, who spoke on behalf of the foundation, said that the issue of pensions had been raised several times in previous political forums and that his organization therefore considered that It was important to support this question.

commitments

In a brief statement, Judge Yankson, chair of the committee, said the committee had hired unions, the SSNIT and NPRA, adding that he had reached a stage where he was awaiting certain decisions.

He added that the trade union movement had always been steadfast, defending and defending what it believed to be fair to the workers of Ghana.