The Social Security and National Insurance Trust (SSNIT) has increased pension benefit by fifteen per cent for pensioners on the scheme.
With the new increment, the minimum monthly pension for existing pensioners has been increased to GH¢409.10 in 2024 from GH¢300.00 in 2023.
The Director-General of SSNIT, Dr John Ofori-Tenkorang, who stated this during a news conference in Accra yesterday to announce the 2024 pension indexation rate, said the increment of the SNNIT pension benefit was done in consultation with the National Pensions Regulatory Authority (NPRA) and in line with Section 80 of the National Pensions Act, 2008 (Act 766).
He explained that the “indexation of pension” was used to adjust pensions in payment to help maintain purchasing power of pensioners.
Dr Ofori-Tenkorang said the monthly pension was indexed at 15 per cent to ensure the sustainability of the scheme.
He said the new pension increment, which would affect about 243,575 members on the scheme, would result in an additional pension expenditure of GH¢ 697.64 million.
“The total expenditure in 2024 for pensioners on the Pension Payroll as at 31st December 2023 will be GH¢ 5,387.72 million. The GH¢ 5,387.72 million excludes pension cost for new awards i.e. the benefits to be paid to retirees who would be added to the pension payroll in 2024. The total benefit expenditure is projected to increase from GH¢ 5,445.91 million in 2023 to GH¢ 7,023.43 million in 2024,” Dr Ofori-Tenkorang stated.
Explaining the implementation of the new increment, the Director-General of SSNIT said all the pensioners on the SSNIT Pension Payroll as at 31st December 2023 would have their monthly pension increased by a fixed rate of 10 per cent plus a flat amount (five per cent redistributed) which would help members to get additional GH¢79.10 to their pension.
Dr Ofori-Tenkorang said redistribution was a mechanism applied to the indexation rate to cushion low-earning pensioners in conformity with the solidarity principle of social security, adding that the SSNIT Scheme, like any other defined benefit scheme, paid pensions which mirrored the earned salaries on which contributions were paid.
“The effective increase in pensions would therefore range from 10.05 per cent for the highest-earning pensioner to 36.37 per cent for the lowest-earning pensioner. Accordingly, the highest-earning pensioner as at 31st December 2023 will receive GH¢ 186,777.58 per month in 2024,” he stated.
He entreated workers, particularly those in the informal sector, to enrol on the SSNIT pension scheme so they could enjoy retirement income security.
Dr Ofori-Tenkorang said the SSNIT Pension scheme was the only scheme that paid members till they did after retirement.
The SSNIT Director-General said the total monthly benefit of GH¢480 million, involving 19,100 members, had been withheld since 2018.
He said the amount had been withheld because the beneficiaries had not come to validate their membership with the scheme.
The General Secretary of the National Pensioners Association, Stephen Boakye, commended SNNIT for the increase.
He said members of the Association was expecting a ten per cent indexation rate and were happy they had gotten 15 per cent.