The latest update for Ghanaian workers: SSNIT Considers Increasing Retirement Age to 65 years.
The CEO of SSNIT has indicated that the need for an increase in retirement age would need a further consultation as one measure out of three measures to sustain the pension scheme.
According to the CEO, Ghanaians are living longer years after retirement than before where SSNIT is paying people close to 100 years. This longer years expectancy now experienced by Ghanaians means the trust is paying more people for longer years than before, which threatens the sustainability of SSNIT.
SSNIT Increasing Retirement Age to 65 years
Three measures are therefore considered to make sure SSNIT does not run out of funds to pay pensioners. One of such measures is to increase the retirement age to 65 years. The increase in the age limit would mean retirees would spend fewer years as pensioners and so the total/cumulative monthly pension payments would be less by 5 years. The increase in the retirement up to 65 years would also mean SSNIT members would contribute for extra 5 years to the scheme compare to what exist now
The second measure being considered to sustain SSNIT and prevents its collapse is the increase in the contributions by employees and/or employers to the SSNIT scheme. However, there would be a likelihood of employers/employees resisting this method since an increase in the employers part of the contribution would increase the salary cost of their operations. Also, an increase in the employees part of their contributions would result in a decrease of disposable income for the workers which is politically unwise. This measure would have brought in more revenue for SSNIT to redistribute.
The third measure also considered is the enrolling of more workers into the SSNIT scheme to bring in more revenue to SSNIT. Presently there are a little over 1.7 million Ghanaians contributing to SSNIT out of over 14 million work force. This measure would however face a huge hurdle since the Ghanaian economy is mostly informal and undocumented.
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Interestingly, SSNIT does not look at its own operations, investment and projects as a means of retaining revenue to sustain SSNIT looking at how media reports paint a picture of loose cooperate governance their system are. A typical one is the OBS deal which is in court after the harm had been caused and extra resources being used to prosecute people involved. Also, government continue to owe SSNIT huge sums of money that could have been invested for returns that could sustain SSNIT
By: Vincent Agbenyo (A Volunteer)