The Industrial and Commercial-Workers Union (ICU) has reiterated a call on the Social Security and National Insurance Trust (SSNIT) to explain how it works out pension payouts.
General Secretary of the Union, Solomon Kotei, said although the Trust has stated the formula used to calculate the monthly payouts to pensioners, how it arrived at some monthly payments and what informed them remains shrouded.
Speaking on the Labour Day edition of current affairs programme, PM Express, he said many pensioners receive meagre contributions that cannot support them adequately.
“Our data show that [pensioners] have, miserable lives, they get more sicknesses – they are not able to care for themselves and eventually they die. So this particular 2019 May Day is meant to talk more on the various dimensions of the contributions that we make to SSNIT and what reverts back to us in our old age,” he said.
SSNIT uses a formula that depends on the age a worker retires; the total contributions the worker has made before retirement and the worker’s three best annual salaries.
But ICU says the knowledge of these factors is not enough.
“We are not only interested in the parameters. But what and what constitutes them so that if I am a contributor and I know I must do something more to get me what I can live on and not just to survive,” he said.
Currently, the minimum pension income a pensioner can earn is GH¢303.6. This implies that no matter how low a worker earns as salary is, their monthly pension payout when they retire cannot be less than GH¢ 303.6.
Mr Kotei said for about two years, Organised Labour has been pushing for clarity from SSNIT on how pensions payout are computed.
He said the theme for this year’s May Day celebration, Sustainable Pension for all: The Role of Social Partners, reflects Labour’s desire to change the incidence of meagre payouts to pensioners.
Austin Gamey, a labour expert, also said on the show that the meagre monthly payout to pensioners demonstrates a major challenge.
“The spirit behind the pensions scheme has been thrown overboard,” he said.
Meanwhile, during a pre-May Day forum presentation last week, Director-General of SSNIT said the law on Ghana’s pensions scheme must be reviewed.
Dr John Ofori Tenkorang noted that there should be considerations to pay beneficiaries based on the average of their total active years instead of the average of their best three years.
“SSNIT is committed to paying all legitimate claims that come before it. I must state unequivocally that SSNIT is not cheating pensioners. It is not in my interest or any SSNIT employee not to pay the legitimate claim to any pensioners.”
“And we must also have some conversation on whether it is appropriate to just pay dividends based on only best three years of contributions. In other jurisdictions like the UK, the lifetime average is what is used,” he said.
Watch more from Wednesday’s PM Express below.