Gov’t pays GHS 5.7bn debt to SSNIT as social security

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The government has since 2017 made payment of GH¢5.77 billion to clear part of the social security contributions owed to SSNIT, the latest update from the Social Security and National Insurance Trust (SSNIT) has shown.

Delays in the payment of due contributions by the government have been cited in the actuarial valuation reports as hampering the scheme’s level of investible funds. Indebtedness by the government to the Trust continues to hurt the scheme’s compliance rates and long-term sustainability.

SSNIT in its update assured that management has not relented in its efforts to retrieve all arrears owed the Trust by employers to improve the sustainability of the Scheme.

“It must be noted that government has since 2017 paid GH¢5.77billion to clear social security contributions owed by successive governments. SSNIT continues to actively engage government, the largest employer, to pay the contributions of its employees,” the Trust highlighted.

As of September this year, 7,951 criminal cases were pending in court against defaulting employers. Likewise, over 500 employers – including the government – have arranged for terms of the settlement.

According to the Africa Centre for Retirement Research (ACRR), indebtedness to the Trust almost doubled in 2018; given that delay in contribution, payment has been assessed to have a tremendous impact on the long-term cost of the scheme. Over 75 per cent of indebtedness to the Trust is by the government.

“It is imperative that government settles its outstanding indebtedness to the Trust and sticks to the payment schedule as stipulated by section 63 of Act 766. As well, this will present a good example for private sector employers to follow,” ACRR said in its research report.

Private-sector indebtedness

Over GH¢230million remains outstanding in debt by the private sector as of September 2021 to SSNIT. This is expected to go up further if the Trust retrieves all outstanding contribution reports and updates inspections on all establishments.

The Director-General of the SSNIT, Dr. John Ofori-Tenkorang, said the Trust takes no delight in taking legal action against employers, but it has become necessary for SSNIT to fulfil its obligation to pay retirement benefits.

SSNIT also assured all stakeholders and the public that the Scheme presently has enough reserves to pay all accruing benefits due to members and their validly nominated dependants.

“The Trust, therefore, assures all members and the public that it will continue to ensure prudent management of funds to enhance the long-term sustainability of the Scheme,” it said.

 

 

Source: Starrfmonline.com

 

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