Informal sector pension membership is guarantee for loans

Ho, Sept 26, GNA - Contributions of the self-employed to the proposed Informal Sector Pensions Scheme could be used as guarantee for business development loans for scheme members. The aggregate of a members' contribution, business profile and other pre-requisites would determine quantum of credit offer to applicant.

Mr Daniel Aidoo Mensah, a Project Consultant of the Pension Reform Implementation Committee, said this during a meeting of committee members with some self-employed in Ho on Tuesday. He said Ghana's pension's regime was being re-designed into a three tier system with the first two-tiers for formal sector workers and the third tier being a self-contribution scheme for the self-employed. Mr Mensah said the proposed informal sector scheme would have contributors' savings put into two different accounts which would yield separately a monthly pension payment and a lump sum at retirement. He said well-thought out regulatory procedures had been proposed in the law to ensure that money lodgements into the scheme were safe, investments prudent, contributors interest paramount and scheme administrative bodies at various level the best. Mr Mensah said only companies chartered by the Bank of Ghana and the scheme's umbrella regulatory body would manage the privately run system, which is opened to all self-employed people including farmers, dressmakers, hairdressers, artisans, traders and blacksmiths. He said the mode of contributions would be liberal and amounts based on income, stressing that the scheme could make the various pension groups influential investment brokers in the country. Mr Smart Chigabatia, Administrator of the Pension Reform Implementation Committee, said the proposal was a good one, which could change the socio-economic circumstances of the self-employed, about 80 percent of workers population in the country. Contributors during question time expressed reservations about the impolite manners towards the self-employed at public offices, which drove them away from participation in such programmes. They also wondered whether the low and irregular incomes of the self-employed in the region would give them any worthwhile benefits from the scheme. Similar outreaches were held at Kpando, Hohoe and Denu in the Ketu-South District.