It appears government has no money to pay six
years accumulated tier-two pension money owed public sector workers.An
emergency meeting summoned at Flagstaff House yesterday by President John
Dramani Mahama to avert a strike action by 12 labour unions ended
inconclusive.
Sources familiar with what transpired at the meeting
yesterday, told The Finder that the unions stuck to their guns since government
assurances were not satisfactory.
Consequently, the sources said member
unions of the Forum for Public Sector Registered Pension Schemes would hold a
crunch meeting this afternoon.
According to the sources, who do not want
to be named, at the end of this afternoon’s meeting, the Forum is likely to
declare an indefinite strike.
Two weeks ago, the Forum warned that if
their 2nd-Tier pension contribution of 5% for the month of October was not
credited to their accounts by close of work Monday, November 14, 2016, they
would embark on an indefinite strike from yesterday.
To avert the strike,
President Mahama summoned a meeting yesterday afternoon which ended
inconclusive.
GH¢1.6bn accrued as at 2014
When the Forum embarked
on strike in 2014, the Chief Executive of the National Pensions Regulatory
Commission (NPRA), said the amount accrued since the coming into effect of the
new pensions law in 2010 is estimated at over GH¢1.6bn.
The breakdown of
the GH¢1.6bn is as follows: GH¢522m being contributions from private sector
workers, originally paid to the Social Security and National Insurance Trust
(SSNIT) and later transferred to the Bank of Ghana (BoG), GH¢490m being public
sector workers’ contributions paid to the Controller and Accountant General’s
Department (CAGD) and then transferred to the BoG, and investment income of
GH¢600m from the two sources.
This figure is far greater than the figure
of GH¢440m that Mr. Haruna Iddrisu, the Minister of Employment and Labour
Relations, indicated had accrued at press briefings in 2014.
GH¢200m not
paid by govt in 2014
NPRA Documents presented to Parliament in 2014 and
sighted by the media stated that the CAGD had “failed to transfer more than
GH¢200 million of workers’ pension contributions” into the Temporary Pensions
Fund Account (TPFA).
It was also reported that contributions collected
by the SSNIT between June and September 2014, had also not been deposited into
the TPFA.
Bank Transfer Advices (BTAs) to CAGD as on October 27, 2014,
showed that the total contributions outstanding amounted to GH¢269,269,105.79,
but this excluded contributions for August and September 2014, for which BATs
have not been issued.
Moreover, this amount did not include interest on
the delayed and unpaid contributions.
If the strike takes effect, public
schools, hospitals and government machinery face total shutdown tomorrow.
By law, the 5% 2nd-Tier pension contribution for the previous month is
to be paid within 14 days of the following month.
The workers expected to
receive notification from their bankers by close of work Monday, indicating that
their 5% 2ND-Tier pension contribution has been credited to their accounts by
the Controller and Accountant General but that did not happen.
October 5%
must hit their accounts
Aside the October contribution, the Forum is
also requesting government to transfer all the monies that have accumulated in a
temporary account at Bank of Ghana (BoG) into their accounts
immediately.
Forum registered 3 pension schemes
The Forum has
registered three pension schemes for Civil and Local Government Staff
Association (CLOGSAG), Health Sector and Education sector.
The National
Pensions Regulatory Authority (NPRA) has issued the three schemes fresh licenses
to operate.
15-member board of trustees
The schemes are managed
by a 15-member board of trustees, comprising nine members representing workers,
five government representatives and one independent member with knowledge in the
management of pensions, as required by law.
Under the new pension law,
the National Pensions Act, 2008 (Act 766), the Social Security and National
Insurance Trust (SSNIT) gets 13.5% of contributor’s contributions, 5% goes to
the second-tier operators to be managed by corporate trustees on behalf of
contributors — employees of public and private institutions.
Law took
effect since 2010
Although the law was passed in 2008, it took effect in
2010, within which it mandated employers to deduct 5% of their employees'
monthly salaries and pay them into a Temporary Pensions Fund Account (TPFA) at
BoG.
The account was to absorb the contributions while the NPRA, which
is the regulator of the pension industry, put up the right regulatory framework,
licensed the trustees and registered them for actual work to start.
Mr
Tenkorang said NPRA called them to say the Ministry of Finance has promised to
instruct the Controller and Accountant General to credit their accounts with the
money.
No more promises
The Forum has decided not to entertain
any promise from government officials because, in the Memorandum of
Understanding (MoU) that made the Forum to call off its earlier strike,
government promised to transfer the accumulated amount in Temporary Pensions
Fund Account (TPFA) at BoG into the accounts of the three schemes registered by
workers in April, this year.
In addition, government at the time promised
to start crediting their accounts with their monthly deductions by July, this
year.
However, government failed to deliver on both promises
necessitating the pending strike action.
5% to be invested not below
T-Bills rate
In addition, government will have to breakdown the figure
to show how much was invested during the period and how much interest accrued
from the investment.
This is crucial because, the law states that the
money should be invested to yield interest rates not less than Treasury Bill
rates.
With the promulgation of the National Pensions (Amendment) Act,
2014 (Act 883), the government postponed the implementation of the 2nd-Tier
Occupational Pension Scheme for five years and that cut out those who were 55
years as at January 1, 2015.
The fact still remains that for those who
fall under the National Pensions Act, 2008 (Act 766), cumulative contributions
from January 1, 2010, have not been transferred to the custodian banks of
licensed schemes of the Forum.
Adverse effect on pensioners
The
delay in the transfer of the funds to the various schemes is going to adversely
affect on the level of lump sum or gratuity a retired officer is likely to
receive in the 2nd-Tier.
Case for strike
Making a case for the
strike, the Forum said many Ghanaians were aware of the debilitating conditions
that pensioners found themselves after having diligently served the nation for
many years.
“We all know the extent of control the government of Ghana
wields power over the Social Security and National Insurance Trust (SSNIT) and
how the government has contributed, over the years, to the inefficiencies and
mismanagement of SSNIT through political interference.
“It is because of
these scary conditions at retirement that pushed workers to agitate for pension
reforms and which were wholeheartedly embraced by the government of the day. To
the architects of the three-tier pension scheme, it was crafted to insulate
excessive governmental interference and to engender peer competitions among the
existing schemes so as to promote efficiency,” the Forum
added.
Appointment of Pension Alliance Trust
The government
claims the workers had agreed that Pension Alliance Trust would manage the
funds.
But the workers described as complete falsehood claims by the
Minister of Communications that workers had a hand in the appointment of
Alliance Trust to manage the tier-two scheme of public sector workers.
As
the issues dragged on, the government went to court to obtain an ex-parte order
on the Forum.
The court directed the leadership of the unions to ensure
an immediate end to the indefinite strike and return to work with their
respective members which they obliged.
Government and workers opted for
out of court settlement resulting in the signing of a Memorandum of
Understanding (MoU) to resolve the issues at stake.
Now the 12 unions
have threatened strike again because government failed to implement the
MoU. |
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