CLOGSAG threatens to withdraw services
The Civil and Local Government Staff Association of Ghana (CLOGSAG) has served notice that it will embark on a nationwide strike if the government fails to address all issues regarding the implementation of the three-tier pension scheme in two weeks.
The issues include the transfer of all money deducted from workers’ salaries into a temporary pension fund account (TPFA) to be transfered to the occupational pension fund schemes.
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Also, the computation of past credits being held by the Social Security and National Insurance Trust (SSNIT) that should appear on individual statements should be based on the individual’s contributions, plus interest calculated using the prevailing treasury bill rates, compounded quarterly from the date of employment to date.
At a press conference in Accra on Wednesday, the Executive Secretary of CLOGSAG, Mr Isaac Bampoe Addo, said although President Nana Addo Dankwa Akufo-Addo had, at this year’s May Day celebration, directed the Minister of Employment and Labour Relations to liaise with SSNIT to bring finality to all outstanding issues regarding the implementation of the three-tier pension scheme in three months, nothing had been done about it.
According to him, the position of the Trades Union Congress (TUC) and SSNIT “is at variance with the directive by the President, hence the decision of CLOGSAG to give the government a two-week ultimatum”.
“CLOGSAG is serving notice that if within two weeks the issues raised are not adequately resolved, it will be compelled to embark on a nationwide strike to back its demands,” Mr Addo warned.
He said data on the contribution of individuals to the TPFA and interest accrued at treasury bill full rates and compounded should be available to the schemes immediately.
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Background
Following the passage of the National Pensions Act, 2008 (Act 766), which took effect in 2010, a three-tier pension scheme was introduced. The first and the second tiers are mandatory, while the third is voluntary.
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Act 766 also makes provisions for employers to make direct contributions of 13 per cent for and on behalf of their employees, while employees contribute 5.5 per cent of their basic salaries, totaling 18.5 per cent of basic salaries, as contributions to the scheme.
Being voluntary, contributions to the tier-three scheme are up to the employee and the employer to determine how much of the employee’s salary will be contributed to this tier.
Rationale for strike
Mr Addo said although the President’s three-month directive to SSNIT, the National Pensions Regulatory Authority (NPRA), the Ministry of Employment and Labour Relations and the Ministry of Finance to resolve the issue expired on July 31, 2019, the issue had still not been resolved.
“If these issues are not resolved, we are embarking on an indefinite strike from September 25, 2019,” he said, pointing out that CLOGSAG had been too lenient with the government for giving the two-week ultimatum.
He said the association ought to have declared the strike long ago, following the failure of SSNIT, NPRA, the Ministry of Employment and Labour Relations, TUC and the Ministry of Finance to act on the President’s three-month directive.
He said after the President’s directive, CLOGSAG had interacted with the relevant ministries and pension stakeholders but nothing had been done, saying: “We cannot continue to be silent.”
Mr Addo said CLOGSAG decided to give an ultimatum because the issues had not been treated with seriousness by the responsible bodies.
Meetings
He said the National Executive Council (NEC) of CLOGSAG met On Tuesday to discuss attempts by the TUC and SSNIT to derail the implementation of the right to withdraw from the three-tier pension scheme without tax obligations, which is to take off on January 1, 2020.
The executive secretary said CLOGSAG would for now use the strike to press home its demands, adding that it would not side with the proposed extension of the implementation period for the three-tier National Pensions Act.
Mr Addo indicated that the issue was not a problem concerning CLOGSAG alone but that it was a national issue affecting all individuals paying SSNIT contributions in the country and urged all SSNIT contributors to be interested in the issue.
“CLOGSAG would wish that the ongoing discussions relating to past credit and data on the transfer of TPFA funds would be expeditiously dealt with,” he said.