49,795 register with SSNIT Informal Sector Scheme

By Seth KRAMPAH, Kumasi

The SSNIT Informal Sector Pension Scheme has as at the end of October 2009 registered 49,795 and is likely to give contributors the expected benefit even much better than the SSNIT Pension Scheme, B&FT has learnt.

The scheme which was introduced by SSNIT in May 2005 on pilot basis currently operates in five regional capitals with eleven contact offices. In Accra alone the Scheme registered 17,446; Kumasi has also registered 13,541 with Takoradi registering 9,538 and Koforidua with 7200 members. Hohoe which was opened just in the last week of August 2009 has 2,042 members. Plans are underway to open a branch in Tamale by the end of November 2009.

In Ashanti Region alone the SSNIT Informal Scheme was able to register 7,374 clients when the Scheme was at its pilot stage with only the Adum office. The Scheme currently operates in Ashanti Region with two additional offices. These include the Asafo and Suame offices. The region has been able to register 6,167 clients from January 2009 to date alone with 7,374 clients during the pilot period making up the 13,541 clients only in the Ashanti Region.

Categories of membership include individuals-7228, hairdressers-1779, tailors-1652, artisans-1841 and formal sector workers-1042.

B&FT also gathered that in spite of the impressive performance of the Scheme at the regional level, it is also undergoing numerous challenges which may have the tendency to cripple the growth of the Scheme.

These include lack of aggressive public education on the Scheme, poor culture of long term investment with Ghanaians and a lot of informal sector workers are yet to see the need to belong to the Pension Scheme.

A source close to B&FT indicates that based on current projections, the total membership of the Fund is expected to reach 600,000 by the end of 2013. The Patronage of the SSNIT Informal Sector Pension Scheme has been very promising. With the plan to open more branches and contact offices in other parts of the country, the Fund is poised to increasing coverage and extending social protection to workers in the informal sector.

The Social Security and National Insurance Trust (SSNIT) developed a separate social security scheme purposely tailored to suit the needs of workers in the Informal Sector of Ghana after studies undertaken by the Trust’s Research Department and corroborated by a team from the World Bank to the effect that the SSNIT Pension Scheme is not suited to the Informal Sector due to the pattern of incomes in the sector, which is essentially unpredictable and irregular.

The study also showed that workers in the informal sector are however willing to sign unto a social security scheme, which can provide them with long-term and short-term financial benefits since most of them require financial support to boost their businesses and thereby increase their incomes.

. The SSNIT Informal Sector Pension Scheme, is a voluntary contributory pension scheme designed principally for workers in the informal sector, which provides members with benefits that are based exclusively on their contributions. Members employed in the formal sector as well as Ghanaians living abroad can also join the Scheme.

The vision of SSNIT Informal Sector Fund is to become the Market Leader in the provision of social protection schemes for workers in the informal sector through innovative product designs and excellent customer service.

The objectives of the Scheme are to operate a Social Protection Scheme appropriate for the working population in the Informal Sector of the Ghanaian economy as part of the Trust’s mandate under the Social Security Law of Ghana (PNDC L 247 of 1991) and to design, operate and manage appropriate contingencies and pay benefits in accordance with the Rules and Regulations formulated and approved by the Trust.

The Scheme is eligible to any self-employed Ghanaian who is aged between 15 and 59 years is eligible to join the Scheme. Additionally, workers in formally established institutions as well as Ghanaian workers living abroad are permitted to join the Scheme.