Director-General of the Social Security and National Insurance Trust (SSNIT), Kofi Osafo-Maafo, on his part, revealed that despite the challenges they have, the SSNIT scheme remains strong.
According to him, the scheme has paid over Ghc 3.7 billion in pensions to over 250,000 retired workers in Ghana as of August 2024.
The figure is a significant increase compared to what was paid for the entire year of 2023.
He disclosed this at an engagement the scheme had with pensioners regarding the International Labour Organization’s (ILO) recent report that predicts that SSNIT’s reserves will be completely depleted by 2036.
He assured the pensioners that the scheme was strong and will continue to serve its constitutional mandate in providing Ghanaian workers with a better retirement.
According to the ILO’s report, starting in 2029, the total income, including contributions, investment income, and other income, will no longer cover annual expenditures, leading to a decrease in reserves.
The report also disclosed that the reserve will be exhausted by 2036.
But the SSNIT boss maintained that they are focused on making the scheme stronger by expanding coverage to the vast numbers of self-employed workers in the country.
He underscored the need to build an inclusive system that will benefit every Ghanaian worker and ensure a secured retirement for all.
He stressed that management of the scheme will continue to take rigorous steps across all fronts to ensure the continuous sustainability of the scheme.
“We are managing costs better. We are accepting contribution collections. We are managing investments prudently. We are engaging the government with respect to issues of arrears with some success, and we continue to impice the underlined financial performance of the scheme. For those of you who may have been looking at our financial performance, from 2021, which was considered the year after COVID, we moved into a surplus position of approximately GHC 230 million. In 2022 and 2023, we improved that and chalked much more significant circles. And in 2024, we continue to produce a surplus driven by a combination of net investment income, improved net contributions, and management of our costs.”
Chief Actuary Joseph Poku also commented on the ILO’s 2020 Actuarial Valuation Report, which, among other things, indicated that SSNIT would not be able to pay benefits beyond the next 12 years (2036) due to depleting reserves.
Mr. Poku explained that an actuarial valuation report was done every three years in line with the National Pensions Act 2008, Act 766, Section 53(2), which mandates the trust to obtain external actuarial valuation on the scheme at least once every three years.
He noted that the recent ILO Actuarial Valuation Report, which was the 12th external report on the SSNIT Pension Scheme, was to give the telescopic view of what was possible (not certain) to happen in the future based on the set of assumptions used by the ILO and other actuarists.
‘The 2020 ILO Actuarial Valuation Report on SSNIT did not mean the trust would collapse in 2036. The assumption in the current ILO 2020 Actuarial Valuation Report was not different from what was made in 2011, 2014, and 2017, which said the reserves of the Trust would be depleted in 2019, 2042, and 2038, respectively.
In terms of the recommendations by the ILO on the need to increase the SSNIT contribution rate, he said that would require consultations with all stakeholders, adding that they had taken measures to address the long-term sustainability of the scheme.
Some of these measures included deactivation of ‘ghost’ pensioners from the payroll of the Trust, adding that this has helped in saving the scheme GH₵519 million as of March 2024.
By: Rainbowradioinline.com/Ghana
