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Business News of Thursday, 26 September 2019


84% of workers not on any pension scheme; local economy endangered - NPRA

Hayford Attah Krufi, CEO of National Pensions Regulatory Authority Hayford Attah Krufi, CEO of National Pensions Regulatory Authority

With 84 per cent of workers in Ghana’s informal sector not on any form of pension, the National Pensions Regulatory Authority (NPRA) and the Industrial and Commercial Workers Union (ICU) among other stakeholders fear the country’s local economy is endangered.

According to the NPRA, the development “paints a very gloomy picture for the Ghanaian working force. Poverty and other old age as well as retirement challenges ahead of the Ghanaian worker within the coming years could be insurmountable if not addressed now.”

Chief Executive Officer (CEO) of the Authority, Mr Hayford Attah Krufi said “this is unacceptable and it calls for an urgent and drastic action to bring the informal sector worker on board pension schemes.”

Local economic activity in Ghana stems to a large extent from small, informal businesses. Their interests are hardly reflected in development strategies thus leaving their potential for economic growth and poverty reduction largely untapped.

Mr Krufi maintained that a lot had to be done to sensitise the working population, not only to encourage them, but also to provide the assistance and support for them to enroll on pension schemes so they can enjoy comfortable and stress-free retirement.

The CEO who was speaking with reporters in Accra said his outfit had mapped up a strategy “to help address this looming national challenge before it gets out of hand.”

“As an Authority, we are committed to a nationwide outreach programme to educate and sensitize workers to deepen their understanding of the Three-Tier Pension Scheme, which seeks to provide for pension benefits that will ensure better retirement income security, for all workers especially those in the informal sector, and a better standard of living,” he stated.

ICU backs efforts to change narrative

Secretary General of the ICU, Mr Solomon Kotei referred to the trade union adage that said “poverty anyway is a threat to prosperity anywhere,” and described the concerns of the NPRA as genuine and one that could spell doom for the Ghanaian economy in the near future.

“For those who are in the informal sector we are going to have old persons who will be frustrated and will become a liability on society which will impact the economy negatively if efforts are not made to get them onto some pension schemes,” Mr Kotei maintained.

According to him, the ICU had commenced (on pilot basis) efforts to pool the self-employed–barbers, hairdressers and basket weavers among others to begin to contribute to the Social Security and National Insurance Trust (SSNIT), however the move could not be sustained, “ because they were not employees with defined incomes and as such at the end of every month they were unable to pay the requisite contributions to the SSNIT.”

NCCE must incorporate pensions into its educational drive

The ICU boss urged the National Commission for Civic Education (NCCE) to incorporate education on pensions into its campaign for the benefit of all citizens.

“All actors, including the NCCE must get their acts together to ensure that the self-employed and workers who fall under the informal sector are covered.

Labour consultant and human resource expert, Senyo Adjabeng called for increased sensitisation of workers in the informal sector so they appreciate the benefits of coming under one pension scheme or another to forestall retirement challenges.

He however was of the view that workers in the informal sector could not be compelled into joining any scheme, adding “its voluntary and we do know that some of these workers have signed onto various life insurance products.”