Several years ago in Ghana, people or workers depended on the extended family members for basic needs like food, shelter and even paying school fees for their wards and children when on retirement from active work (farming, fishing, selling, menial job, etc).
On attaining independence in 1957, the intensive industrial and educational programme introduced by the new government resulted in a large influx of people to cities and urban areas in search of white collar jobs.
The economic and political challenges created by the rural-urban migration coupled with the worker who had been stripped of the security he/she enjoyed from the traditional family system put the traditional social protection system in danger.
Gradually, the extended family system had given way to close family set ups, therefore bread winners needed to plan towards contingencies such as old age, sickness or death.
Consequently, the First Republic instituted a compulsory savings scheme and later the Social Security Scheme for workers in Ghana. This is to ensure that, upon retirement, one will have part of the lost income replaced.
Definition of Social Security
Social Security can be defined or has been defined by the International Labour Organisation (llO), ‘as the protection which society provides for its members through a series of public measures against the economic and social distress that otherwise would be caused by the stoppage of substantial reduction of earnings resulting from sickness, maternity, employment injury, invalidity, old age and death.’
Social Security therefore can be explained as measures or arrangements put in place by governments the world over, to protect workers against certain contingencies that are likely to happen to them one time or the other, thereby, providing some safety nets to fall on in times of need.
The idea is to replace part and not whole of an earned income during one’s working life with pensions throughout retirement until death.
The Social Security and National Insurance Trust (SSNIT) is currently charged with the administration of Ghana’s Basic National Social Security Scheme. Its mandate is to cater for the first tier of the three-tier pension scheme.
The primary responsibility of SSNIT is to replace part of lost income of workers in Ghana to cover old age, invalidity which are enjoyed by the member or the death and survivors benefits which is enjoyed by their dependants (nominees) when the member dies under Act 766.
SSNIT benefits payable to beneficiaries therefore cover the Old Age Pension, Invalidity Pension and Survivors Lump sum.
Survivors Lump Sum
Nostalgically, I reminisce that, in the olden days, we never had orphans in the family. An orphan in the compound house is everybody’s child. Modernisation has changed all that.
The Death and Survivors Lump sum is the benefit paid to the nominated or eligible beneficiaries of a deceased contributor. This benefit is paid when a member dies in active service or during retirement and have not attained the age of 72 years for those under PNDCL 247 and 75 years for those under the new National Pensions law, Act 766 respectively.
When a pensioner dies, the benefit (money) to be paid to beneficiaries is the accrued benefit for the period between age at death and age 72 (PNDC law 247) or 75 (Act 766) years at current value. For example, if a pensioner under PNDCL 247 dies at age 62, all pensions to be paid from 62 years to 72 years will be computed, discounted and paid to the nominees.
Alternatively, when a pensioner under Act 766 dies at age 62, all pensions to be paid from 62 years to 75 years will be computed, discounted and paid to his nominated dependants.
A person becomes a beneficiary when a contributor nominates him/her or when death occurs as determined by law. Any child above the age of 18 years who was not nominated by the contributor or the pensioner could secure a court order to vary the nomination to be included in the claim.
This means that the court would nullify the initial nomination of the SSNIT deceased and order the children who were not nominated by the deceased contributor to be included.
The Children’s Act, Act 560 also protects the rights of minor children who are under the voting age of 18. By Act 560, 60 per cent of the benefit is paid to the minor child(ren) whilst the remaining 40 per cent is shared or paid to the nominated person(s).
In Social Security nomination in Ghana, a member can only nominate a relation and not invalid nominations such as “my church” my “girl friend”, ete.
The Schedule of Act 766 states who can be nominated under both the Paternal and Maternal inheritance system.
Again, another way through which one can qualify for a Survivors’ benefit is when the Intestate Succession law, PNDCL 111 is applied for other dependants of the deceased member to be included in the distribution of the SSNIT benefit, e.g. when a nominee dies before the contributor or in the case of an “invalid” nomination” (see nomination by law).
To apply for a benefit under Survivor’s lump sum, a family member has to report the death of the deceased member to the nearest SSNIT Branch with an evidence of death. Anyone of the following documents could serve as evidence of death:
- Letter from the Employer
(Death in active service)
- Medical Certificate of cause of death.
- Death Certificate
- Letters of Administration
- Death Extract
- Letter from Religious Leaders on letter head.
- Affidavits from Chiefs where death occurred or deceased was buried.
- A joint affidavit from the Head of Family and a principal member,
- Police Report
Secondary Evidence(Supporting Documents)
- Obituary Notices
- Order of Service
- Mortuary Report
The death reporter who must be a close relative provides the deceased member’s social security number (if available) and all the relevant information needed for the processing of the claim.
The information to be provided would help SSNIT to easily identify nominated beneficiaries and make the process simpler, easier and faster.
It is important to note that annuity period has a bearing on the computation of the benefit when a member dies in service. The total of 12 or 15 years pension benefits would be discounted, distributed and paid (i.e. when the beneficiaries are more than one).
A deceased pensioner’s beneficiaries are paid the un-expired portion of the benefits (this is benefit accrued between the age of death and either 72 or 75 years depending on which Law it applies).
Who decides the cash a nominee receives
Three scenarios come into play here.
Scenario one: Every contributor during registration into the SSNIT scheme nominates a person or people who should benefit from hislher contribution in case of death. The percentage amount to each nominee is declared by the contributor. Under Act 766, Section 81(5} every member must update his/her nomination at least once in every five (5) years.
Scenario two: When SSNIT convincingly decides that the
Children’s Act, Act 560 and Act 766 Section 81 (7), should be applied, 60% of the total benefit goes to the child or children under eighteen years whether they were initially nominated or not.
However, there would have to be a proof that such a child or children are the biological children of the deceased. Legally adopted children are included.
Scenario three: Again when a Court of competent jurisdiction orders for the inclusion of dependents (children, spouse, parent), those initially not nominated by the deceased member, then they become beneficiaries or when PNDC law 111, the Intestate Succession law is applied. This usually happens when the nominations of deceased member are declared invalid. (e.g. where all the nominated people or person predeceased the contributor and no update was done). Or when the nominee was not a relation of the deceased member.
When any SSNIT Pensioner dies any family member or anybody can report the death to SSNIT through any Branch or the SSNIT Contact Centre on 0302 611622.
The highest Survivors benefit SSNIT paid as at December 2015 was GH¢423,143.99 (May 2014). This year 2015, SSNIT has paid the highest sum of GH¢522,457.00 in the month of June. The lowest D/S benefit so far is GH¢85.25 (May 2014 to date).
Social Security – Hope and assurance to familes
Provision of such benefits under social protection schemes bring hope to families especially surviving spouses and their children who are sometimes harassed unnecessarily by the families of the deceased members with widowhood rites, witchcreft, disinheritance, ete. Shattered dreams are revived when the surviving spouse, children and dependants become aware that the deceased contributor nominated them as beneficiaries or they stand to gain from the Social Security Scheme. In many instances, it helps family members (spouse, children and dependants) to maintain their standard of living or in most cases to continue living meaningful lives after the loss of a loved one.
Workers in Ghana, government and private employees as well as the self employed should deem it important to join SSNIT or any social protection scheme to cater for their children and aged parents in case of death.
Contributors must again make sure that they nominate their dependants and update their records with SSNIT each time there is new birth or when a nominated person pre-deceases the contributor. This is the deceased members social security “saman . siw” testament. These updates should at least be done once every
After the report of the death of the member, SSNIT releases the five (5) years or as and when necessary to ensure that the right people receive their benefits, names of beneficiaries nominated for further processing. The actual processing of the benefit then begins with the released beneficiaries.
After a series of interviews, the identified beneficiaries have to provide some form of national identification (voters 10, passport, driver’s license, SSNIT biometric smart card, etc},two recent passport size photograph and personal bank account details. The amount due the person as per the percentage given by the deceased member is deposited in the beneficiary’s account.
One qualifies for Survivors’ benefit from SSNIT only after the death of a contributor and an evidence of the death has been provided, vetted and confirmed. The member could be in active service or is on retirement but have not attained the age 72 (PNDCL 247) or 75 (Act 766).
Contributors should feel free to nominate all their children both within and outside marriage because information on contributors are kept as classified information by SSNIT. No one gets to know who has been nominated until death occurs and the nominees are released. We are not encouraging promiscuity but these are real issues, that must be addressed in real terms.
The Social Security Scheme is there to cushion and serve as safety net for workers and their dependants. Sign onto the scheme today and secure a future for yourself and your family. And if you have been registered biometrically and you have been informed that your smart card is ready, kindly contact your Branch of registration for collection. You will need the SSNIT Smart card for any transaction with SSNIT.
By Stella Andoh Annan