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Business News of Friday, 8 May 2015

Source: B&FT

Diplomats must benefit from state pensions – PAC

The Public Accounts Committee (PAC) chairman Kweku Agyeman Manu has charged the Foreign Affairs Ministry to expedite processes to ensure that Ghanaians abroad serving in Ghana Missions contribute to and benefit from state pensions.

This, he said, will enable the government to deduct appropriately the SSNIT contributions of civil servants serving in the country’s Missions abroad.

Currently, about 16 retirees of the Foreign Service have not been paid their SSNIT pensions and are awaiting an exercise between Foreign Ministry and Controller and Accountant-General’s Department to be completed before they can access their pensions.

“We need a cut-off from somewhere. As soon as you get this thing sorted, whether it comes in the form of a bill to parliament for us to deliberate on it for Foreign Service directors or you look at holistically, as in all other Ghanaians who go on postings and how their pensions are treated… so we have a law on that. I believe that will solve the challenge we have,” he said.

As of now, the Controller and Accountant-General’s Department do not deduct the SSNIT contributions and income tax of Foreign Affairs officials serving outside the country, a situation that makes it difficult for them to claim their pension benefits when going on retirement.

Foreign Affairs Minister Hannah Tetteh conceded that the country has not properly regularised the legal position regarding tax exemption and SSNIT deductions of Foreign Affairs employees serving abroad, describing it as an anomaly that has to be rectified.

According to Ms Tetteh, throughout the country’s democratic dispensation till date the country has not taken any steps to properly amend laws so as to capture the payment that ought to be made to Foreign Service officers.

“There are current discussions ongoing because there is the issue of not only the employer making up the contributions that were not paid, but the employees also making up the contributions that were not paid in order to be able to benefit from a pension…I hope the Committee will be able to recommend that the appropriate amendments are affected to existing legislation.

“The basis for that non-deduction is not the diplomatic immunities act. My information and the records of the Ministry of foreign Affairs show that the last time a salary structure for missions abroad was determined by the ministry was in 1987, and I must also add that since then there has been no increase in the salary structure of workers as far as Missions abroad are concerned.”

The Foreign Affairs Ministry is now understood to be collaborating with stakeholders, SSNIT, Controller and Accountant-General’s Department to ensure gaps are filled in terms of SSNIT contributions.

Meanwhile, Hannah Tetteh explained that “Missions that are established in Ghana, for incomes that is earned by envoys who are accredited to the Republic of Ghana by any external state …we do not charge tax on those incomes,” she said.