Four years after the passage of the new pension law, its full implementation is yet to take off and the fate of service providers and trustees registered with the National Pensions Regulatory Authority (NPRA) is left hanging.

Though the pension reforms have been paraded as promising, with better benefits for contributors, boardroom wrangling fraught with other challenges seem to hinder the take off of the three-tier scheme.

The growing worry have been heightened lately, following the impromptu exit of the Chief Executive Office of the NPRA, Dr Daniel K. Seddoh, who cited frustration and an unhealthy working relationship between him and the board chairman of the company, Richard Kwame Asante, as some reasons for his exit.

“It is common knowledge among board members that the working relationship between the chairman and the acting Chief Executive Officer has not been cordial,” Dr Seddoh said in his resignation letter, adding that the board had set up a mediating team to identify the root cause of the problem and make appropriate recommendations.

The man who was in office for only a year said, “From my position as the Acting Chief Executive Officer, the non-cordial working relationship is not a personal issue but rather conflicts that are coming out from corporate governance challenges and differences in the management style of running the business of the authority.”

The resignation letter, which was signed by Dr Seddoh and addressed to the office of the President, referred to an earlier memo from the NPRA board chairman and said the issues raised in the memo were purely an attempt to play him against the board and Government.

“The board is fully aware of my concerns and frustrations in running the authority and these I have raised in one form or the other to board members.”

He noted, “I have admitted to the board previously that I have consulted some eminent people to discuss my frustrations with the administration of the authority. I did this with the best of intentions to get help and highlight the importance of the authority in the national economy.”

In line with an implementation time table which has been reviewed a number of times, the authority should be getting ready by now to transfer funds to the accounts of approved trustees.

Yet, after more than two years of going through the rigorous registration process, the trustees and service providers are yet to be granted their licences, though they have invested in the provision of office accommodations, among others.

Meanwhile, observers have expressed worry over the possible delay in the implementation of the new pension scheme, following Presidents John Atta Mills’ announcement, during its launch, that it begin operations in January this year.

There had been much publicity of the new three-tier pension scheme to increase pension benefits and retirement income protection for workers, according to observers. However, the new three-tier pension scheme replaces a parallel pension scheme operated by the Social Security & National Insurance Trust (SSNIT) and the CAP 30.

It comprises two mandatory schemes and a voluntary one. The first tier, mandatory for all employees in both the private and public sectors, will have employees paying 13.5 percent contribution to SSNIT, while the second mandatory second-tier of five percent goes to fund managers.

The third tier, which is voluntary, would be paid by individuals to privately-managed pension schemes. The new scheme would not only cater for workers in the formal sector, but also the informal sector which forms 80 percent of Ghana’s working population.

With contributions on their own volition, workers in the informal sector as well the self-employed people such as farmers, fishermen, market women, among others, can now participate in the pension scheme during their old age.

The second tier will be more flexible in meeting the different needs of employees and contributors may have access to some funds for special needs such as housing prior to retirement.

Under the new pension scheme, employees and potential pensioners, prior to retirement, can use future lump sum pension benefits as collateral to secure home mortgages. The new pension was expected to have become operational by January 2010.

A second-tier deduction from the contributions of workers whose pension payments go to SSNIT, is currently being kept in a special fund with the Bank of Ghana since the fund managers are yet to take over

Sam Pee Yalley, acting Deputy Chief Executive, whose appointment took effect on February 18, 2011, said the fund was accruing interest pending the full implementation. In this case, the second-tier will be transferred to the fund managers with the interest credited to contributors’ accounts.

Concerning the delays in the payment of pensions, he remarked: “We must establish proper guidelines and regulations.” He admitted that there had been a review of the existing model, adding that “it is better late than never.”