Organised Labour must ensure SSNIT works in the interest of beneficiaries – GFL

The Ghana Federation of Labour (GFL) has admonished Organized Labour of Ghana to ensure that the board of the Social Security and National Insurance Trust (SSNIT) operates in a way that protects the interests of pensioners.

The Secretary General of the GFL, Abraham Koomson, who was speaking on Power Kasiebo on TV XYZ, observed that the Akufo-Addo government had been unnecessarily barging into the affairs of SSNIT and causing the trust’s finances to decline through suspicious investments.

Although he admitted that the contributions of Ghanaian workers to SSNIT are invested into other ventures to accrue profits for onward distributions to pensioners who had over the years contributed to the trust, Mr. Koomson cited clandestine wastages as the cause of the near collapse of the institution.

According to him, the Akufo-Addo government has contributed to the financial challenges of SSNIT, which have affected the monthly stipends of pensioners.

Reacting to the government’s direct interference with the operations of SSNIT, the vociferous unionist stated that until Organized Labour charged its representative on the board of SSNIT to fight for the right thing to be done, the trust would head into a ditch.

“Organised Labour has a representative on the board of SSNIT, so we have to ensure that the representative does not go into meetings only to drink tea and take allowances,” Mr. Koomson said.

“If that happens, it means we have failed workers who are now pensioners and those contributing to SSNIT,” he added.

Where SSNIT’s woes are emanating from:

Mr. Koomson further threw more light on the unfortunate happenings at SSNIT that were hindering the progress of the institution, saying the government fired the former Director General of the state institution, Dr. John Ofori-Tenkorang, only to manipulate the current SSNIT boss to misuse the funds meant for pensioners’ comfort.

After the firing of Dr. Ofori-Tenkorang earlier this month, he was directed to hand over to Kofi Bosompem Osafo-Maafo, the son of a senior advisor to the president, Yaw Osafo-Maafo, who would later be the successor of Dr. Ofori-Tenkorang.

Mr. Abraham Koomson believes the circumstances leading to Kofi Bosompem’s promotion from the Deputy Director-General in charge of Investment & Development at SSNIT are questionable and dangerous to the trust’s funds.

“Dr. Ofori-Tenkorang was working well, but these people, the NPP, didn’t like his style, so they had to yank him off so they could have access to loot funds from the institution,” Koomson stated in the interview.

To him, it is Organized Labour that can stop the mismanagement of the public funds entrusted to the care of SSNIT.

ILO warning:

SSNIT has consistently provided financial security for retirees since 1991 when it was transformed into a Social Insurance Pension Scheme governed by PNDC Law 247.

However, SSNIT has been projected to deplete its funds to meet its financial commitments to beneficiaries in the future.

A recent report by the International Labour Organization (ILO) indicates, based on its actuarial valuation that SSNIT reserves are expected to reach zero by 2036.

As of 2020, SNNIT had covered 1.6 million Ghanaians, representing approximately 16% of the country’s workforce.

ILO said a growing portion of the trust’s resources intended for beneficiaries is being allocated to the operational costs of the scheme.

The report shows that from 2008 to 2020, the average return on total assets was 12.2 percent. Adjusting for inflation, the real average return on assets is 0.9 percent.

One notable aspect of investing in Ghana is the 91-Day Treasury Bills (T-Bills), which have provided a higher average return of about 17.5 percent over the past 12 years compared to the nominal return on assets. In fact, the fund’s return has averaged 70 percent of the average yield of T-bills.

The GFL believes the situation is worrying, but the government must not touch the funds of the scheme.

Mr. Abraham Koomson, once again, admits the challenges of SSNIT but sees a solution devoid of government interference.

“We got wind of this issue some 5 years ago. It is not a new issue. The problem has to do with the investment that SSNIT makes in people's contributions,” Koomson said.

“Sometime, I remember SSNIT making donations to some chiefs,” he stated, and he condemned such acts while asking the Akufo-Addo government to stay off SSNIT funds.