SSNIT accused of foot-dragging in payment of Past Credit lump sums

The Forum for Public Sector Registered Pension Scheme has accused the Social Security and National Insurance Trust (SSNIT) of foot-dragging with the implementation of the modalities for the Past Credit.

The Past Credit is the contribution of workers to SSNIT before the coming into force of Act 766, which brought about the three-tier pension scheme.

The forum said SSNIT was reluctant to "come out with modalities for the calculation on Past Credit earned as of December 2009, based on a 100 per cent treasury bill rate compounded quarterly, and the issuance of statements to each contributor”.

At a press conference in Accra on Monday, the Hedge Master of the Trust Occupational Pension Scheme, Mr Isaac Bampoe Addo, said: "The Forum sees the stance of SSNIT as a tactical move to sabotage the smooth implementation of the three-tier pension scheme, which is scheduled to be fully operational with effect from January 1, 2029."

Petition

The press conference was to register the displeasure of the forum, which is made up of 13 workers’ unions, with SSNIT’s posture regarding the Past Credit.

The forum petitioned the Minister of Social Welfare and Labour Relations to compel SSNIT to release the modalities for the calculation of Past Credit earned as of December 31, 2009.

Mr Addo gave the minister up to November 18, this year to ensure that the impasse between it and SSNIT was resolved amicably to forestall any industrial unrest.

Read also

SSNIT drags 4,310 employers to court

SSNIT lump sum ends 2019

SSNIT to issue statements of account to contributors

NPRA directive

He recalled that at a meeting among the Ministry of Employment and Labour Relations, the National Pensions Regulatory Authority (NPRA), SSNIT and the forum on the implementation of the Past Credit on October 9, 2019,  "it was agreed that by October 29, 2019, SSNIT would come out with modalities".

However, he said, the forum had reliable information that SSNIT was not going to comply with the directives from the NPRA on the Past Credit.

"As you are aware, January 1, 2020 is the implementation date for tier two pensions, which is just around the corner, and we would not want our members who will be retiring from that date to be paid Past Credit that does not reflect the basis for its payment, as outlined by the NPRA in its letter dated September 18, 2019,” Mr Addo said.

He said it was intriguing to note that SSNIT was highly instrumental in getting the original date of January 1, 2015 pushed to January 1, 2020.

He said the forum was waiting patiently until November 18, after which “we have a number of options”.

He said it was the view of the forum that SSNIT was enjoying monopoly, noting that the forum would soon come up with its position on that and the need to allow others to operate similar services to make the business competitive.

The Daily Graphic contacted SSNIT for a response and the trust gave an assurance to revert.

Lump sum

The Director-General of SSNIT, Dr John Ofori-Tenkorang, at a breakfast meeting with some employers in Accra recently, announced that workers who would turn 60 years from January 1, 2020 would no longer receive lump sum payments from SSNIT, as pertained under PNDC Law 247.

Such contributors, he explained, would now have to turn to the fund managers of their second tier contributions for lump sums.

Dr Ofori-Tenkorang told the employers that in addition to the lump sum from the second tier, SSNIT would pay a lump sum known as "past credit" accruing from earlier contributions by such workers before the coming into force of the National Pensions Act, 2008 (Act 766), which introduced the tier two system.

In addition to that, SSNIT would also pay monthly allowances to such workers, he added.