Finance Minister, Ken Ofori-Atta, has expressed concern about the rising operational costs of the Social Security and National Insurance Trust (SSNIT), demanding “effective cost control and management measures to ensure the sustainability of the fund.”
Speaking at the inauguration of its Board of Trustees, the minister said current operations cost, investment cost and general administrative cost are not sustainable for the nation’s foremost pensions fund.
“The challenge facing the institution would be the need to maintain effective cost control and management measures to ensure the sustainability of the fund,” he said.
According to the Minister, the Trust would have to put in urgent measures to reverse its declining fortunes after it emerged that total monies received from contributors for last year declined 12 percent from the 2015 figure.
Mr. Ofori-Atta said the decrease in contributions is one of the major challenges faced by SSNIT after the introduction of the 3-tier Contributing Pension Scheme in January 2010.
The scheme currently has active contributors of about a 1.33 million and the contributions for the year 2016 amounted to GH?1. 86 billion.
With government debt and arrears of over GH?600million, benefits have been recorded to be GH?1.75billion, which is up 42 percent from 2015.
“It is also well known that the Trust is bedevilled with high and persistent debt and arrears from its public and private contributors in addition to issues such as sustainability of the SSNIT Scheme and expansion of coverage. The combination of all these challenges, among others, have resulted in the poor public image and perception of the Trust,” Mr. Ofori-Atta said.
Swearing-in the board, which is led by Dr. Kwame Addo-Kufuor, the Finance Minister said to ensure the board achieves optimum results, the government will implement numerous policy initiatives, including reactivating the SSNIT Informal Sector Pension scheme that the previous government placed on ice.
The initiative, he said, should result in broadening and deepening pension coverage in Ghana, and could envelope the Cocoa Pension Scheme as well and help alleviate poverty in the retirement period of Ghanaians who work in the informal sector.
The government, he added, will also negotiate and make programmed payments of all pension arrears.
Chairman of the new board, Dr. Addo-Kufuor, said to able to stabilise the Trust, there is the need to subject its structure and performance to an extensive review or diagnosis by reputable assessors, so that an appropriate therapy would be prescribed.
“In spite of these challenges, I believe members of the board, supported by the Director-General, Management, Staff of SSNIT, and all interested parties, will work hard to overcome these hurdles and direct SSNIT on the path of viability,” he said.
The membership of the board trustees include: Abena Osei-Asare, Alex Frimpong, Daniel Aceampong, Joshua Ansah, Prince William Ankrah, Mahamadu Assibi Azonko, David Ofori Acheampong, Benjamin Odotei Asumang, Beatrice Zakpaa Vib-Sanziri and Dr, John Ofori Tenkorang.