Business

SSNIT increases monthly pension payment by 15%

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The Social Security and National Insurance Trust (SSNIT), in consultation with the National Pensions Regulatory Authority (NPRA) has indexed monthly pensions upwards by 15% for the year 2024.

By this, the monthly payment for pensioners have been increased by 15%.

This is in line with Section 80 of the National Pensions Act, 2008, (Act 766).

According to SSNIT, all Pensioners on its pension payroll will have their monthly pension increased by a Fixed Rate of 10% in addition to a redistributed flat amount of ¢79.10.

Speaking at the launch of the 2024 Pension Indexation Report, Chief Actuary, Joseph Poku, said the Trust is focused on expanding and deepening coverage of the basic national socials security scheme to benefit workers who will go on retirement in the future.

According to him, the indexation is a legal requirement that aims at reviewing the benefits to help pensioners live decent lives.

“The indexation is a technique we use to adjust pensions payment to help maintain the purchasing power of pensioners”, Mr. Poku said.

Providing more details, he said all pensioners on the SSNIT Pension Payroll as of December 31, 2023 will have their monthly pension increased by a Fixed Rate of 10% plus a redistributed flat amount of GH¢79.10.

“Redistribution is a mechanism applied to the indexation rate to cushion low-earning pensioners in conformity with the solidarity principle of social security. The SSNIT Scheme, like any other defined benefit scheme, pays pensions which mirror the earned salaries on which contributions were paid”.

He pointed out that the effective increase in pensions would therefore range from 10.05% for the highest-earning pensioner to 36.37% for the lowest-earning pensioner.

“Accordingly, the highest-earning pensioner as of December 31, 2023 will receive ¢186,777.58 per month in 2024. The lowest-earning pensioner as of December 31, 2023 will have the monthly pension increased from ¢300 to ¢409.10 in 2024”, an additional statement from SSNIT said.

The statement said the average monthly pension will increase from ¢1,527.29 in 2023 to ¢ 1,756.38 in 2024.

“The 15% indexation rate will result in an additional pension expenditure of ¢697.64 million. The total expenditure in 2024 for pensioners on the Pension Payroll as at 31st December 2023 will be ¢5,387.72 million”.

“The ¢5,387.72 million excludes pension cost for new awards i.e. the benefits to be paid to retirees who are added to the pension payroll in 2024. The total benefit expenditure is projected to increase from ¢5,445.91 million in 2023 to GH¢ 7,023.43 million in 2024. Pensioners are paid on the third Thursday of every month”, the statement concluded.

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