Social Security and National Insurance Trust increases pension by 10 %

The Social Security and National Insurance Trust (SSNIT) has increased monthly pension for beneficiaries by 10 per cent.

The increment in the SSNIT monthly pension, called indexation, takes effect from January 2022.

This means that a pensioner who took a minimum of GH300.00 as pension a month last year would now take GHC332.48 a month.

Indexation, according to SSNIT, is a technique used to adjust pensions in order to maintain the purchasing power of pensioners.

Announcing the new increment in pension benefits, the Director-General General of SSNIT, Dr John Ofori-Tenkorang, said the increment was done in consultation with the National Pensions Regulatory Authority. 

He explained that the new increment which was pegged in line with the projected inflation of 2022 of 9.6 per cent, was to improve the purchasing power and living conditions of pensioners.

Dr Ofori-Tenkorang said the increment was being implemented in a manner to help pensioners who received low pension to get more than 10 per cent increment.

“All pensioners on the SSNIT pension payroll as of December 31, 2021 will have their monthly pension increased by a Fixed Rate of 9.68 per cent plus a redistributed Flat amount of GHc3.44,” he explained.

He said redistribution was a mechanism applied to the indexation rate to cushion members on low pensions in conformity with the solidarity principle of social security.

“The effective increase in pensions would therefore range from 9.639 per cent for the highest earning pension to 10.83 per cent for the lowest pension earner,” he said.

He said more than 67 per cent of the current 225,000 pensioners would enjoy more than 10 per cent increase in pension and the remaining who earn higher pension enjoyed a little below 10 per cent.

Dr Ofori-Tenkorang pledged that the management of SSNIT would continue to invest pension funds well to generate better returns for pensioners.

He said management would continue to be transparent in administering pensions and also pay pensions promptly.

He said SSNIT currently paid GHc300 million as pension a month.

Dr Ofori-Tenkorang disclosed that SSNIT paid a total of GHc3.65 billion as pensions last year.

The Chief Actuary of SSNIT, Mr Joseph Poku, said SSNIT, among others, took into consideration the long term sustainability of the scheme and liquidity in fixing the indexation rate.

He said the new increment would cost SSNIT GHc308 million from last year’s cost of GHc243 million.

Mr Poku said the the increment in pension was in line with Section 80 of the Act governing SSNIT.

He said the section mandated SSNIT to annually review pension payment in line with wage inflation rates of active contributors.

BY KINGSLEY ASARE

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