Think tank Africa Centre for Retirement Research (ACRR) is calling for an increase in the minimum pension of GH¢300 from next year.
According to its post-retirement income survey conducted in October, 2020, eight out of 10 retirees in Ghana rely on social security payouts as their main source of livelihood and on average each retiree has six persons who economically depend on them for their living.
“To practically sustain the economic welfare of pensioners, the minimum pension, which has stayed at GH¢300.00 since 2018 need to be reviewed upward in 2022 to reflect the actual cost of living,” ACRR said in a report released on Tuesday, December 14.
“That will also close the growing economic gap between new and old retirees,” it noted.
The Social Security and National Trust(SSNIT) in consultation with the National Pensions Regulatory Authority (NPRA) is expected to announce a new cost of living adjustment for pensioners in January.
This is done annually to cushion pensioners vis-a-vis inflation.
According to ACRR, its projections point to a fixed rate of 9 percent increment for every pensioner as of Friday, December 31, 2021.
“It is therefore expected that the Cost-of-Living adjustment to pensions for 2022, which will be based on the year-end average consumer price index, will likely see the Trust apply at least a fixed rate of 9% as increment for every pensioner who existed on the payroll as at December 2021.”
Meanwhile, ACRR is calling for a relook at SSNIT’s current basis of reviewing pensions.
“We hold the opinion that, in reviewing pensions (as stipulated in section 80 of the Act), the Trust could administratively consider a model that segregates the fixed rate of increment in a manner that, high monthly pension earners shall receive a moderately lower fix rate as compared to low monthly pension earners.
“This will minimize the growing economic inequality between the rich and the poor, deepen the solidarity and risk pooling principles on which social security thrives, as well as improve the long-term financial health of the scheme.”
Source: myghanadaily
