Ghana National Association of Private Schools members have urged the government to change the contribution to the Social Security and National Insurance Trust (SSNIT).
According to Rev. Kow Richardson, National Executive Member of Senior High Schools in Effutu and Former Chairman of Ghana National Association of Private Schools, who spoke to the press, private schools are facing uncontrollable challenges.
He explained his point by saying that taxes on private schools are breaking their necks, and as a result, most private schools have closed, particularly when it comes to paying SSNIT to their employees.
The founder and proprietor of Uncle Rich Schools lament that the government should eliminate some of the taxes on private schools in order for them to expand their operations and employ more people, thereby lowering the unemployment rate.
He believes that the payment of SSNIT CONTRIBUTIONS, which is mandatory for all employers to make for their employees, is a good thing, but the percentages on the payment are too high. For example, if the employer pays his employee Ghc1,000, he must deduct 13% of that amount, add 5%, and pay SSNIT contributions. How much will he be paid at the end of the month?
”The current rate is high. Assume you receive Ghc1000 and must pay SSNIT contributions of approximately Ghc269. What would be left? I propose that the percentage be reduced by ten percent. The law should be amended by Parliament. We could consider a constitutional amendment when the person reaches the age of 50.”
Workers in Ghana are obliged to contribute to the SSNIT Scheme during their working life to receive monthly pensions during retirement or when incapacitated. Upon the demise of the contributor, his/her nominated persons will receive the survivor’s benefit in cash.
Membership of the SSNIT Pension Scheme is open to workers in both private and public sectors. Only Officers and men of the Ghana Armed Forces and Categories of persons explicitly stated by the 1992 Constitution of Ghana are expressly exempted. The scheme is also optional for the self-employed.
The primary responsibility of the Trust is to replace part of lost income of workers in Ghana due to Old Age, Invalidity or Death of a member where dependants receive lump sum payment. It is also responsible for the payment of Emigration benefit to a non-Ghanaian member who is leaving Ghana permanently.
Social Security and National insurance Trust manages the 1st tier of the 3 tier Pension Scheme.
SSNIT has over the years administered Social insurance in Ghana and workers have been well catered for upon retirement and injury under the scheme. All activities undertaken by SSNIT are within the confines of the Law.
The Social Security and National Insurance Trust (SSNIT) is currently charged with the administration of Ghana’s Basic National Social Security Scheme. Its mandate is to cater for the first Tier of the Three-Tier Pension Scheme. The primary responsibility of SSNIT is to replace part of lost income of workers in Ghana.
Therefore the TRUST is mandated by law to;
Operate the Basic Social Security Scheme which is the 1st tier.
Ensure general administration of the Social Security Scheme and Regulations.
Keep a Fund for contributions and other cash received.
Provide Social protection for working population for contingencies including old age, invalidity, death and emigration.
Administer and invest funds of the Scheme under general directions of Board of Trustees and approved by the National Pensions Regulatory Authority (NPRA).
Collaborate with other complementary social protection schemes to achieve efficiency, cost savings and avoid duplication of functions.
Operate other Schemes that may be prescribed by Law.
SSNIT also registers establishments and employees to furnish them with unique Establishment Registration (ER) and Social Security numbers respectively.
These numbers are not transferable and shall be used by employers and employees throughout their transactions with SSNIT.
Contribution Rates under the Social Security Scheme ( Tier 1)
– Employer – 13.0% from worker basic salary
– Worker – 5.5% from workers basic salary
– Total – 18.5%
Out of the 18.5%, the employer remits 13.5% within 14 days of the ensuing month to SSNIT. 5% is remitted to the Second-Tier Mandatory Occupational Scheme.
Subsequently, SSNIT also gives 2.5% out of the 13.5% to the National Health Insurance Authority (NHIA) for the member’s Health Insurance.
SSNIT effectively withholds 11% for the administration of Tier 1.
Entry Age of joining the scheme– 15 years (minimum) and 45 years (maximum) only for new entrants (age 45+ to enter mandatory 2nd tier).
Age Exemption – 55 years and above exempted (option to join)
Minimum and Maximum contributions indicated and reviewed periodically.
Investment of Funds – investment policy, external investments permitted
By: Rainbowradioonline.com/Ghana
