IFS National Pension Dialogue

In 2006, Ghana began a review of its pension system to identify ways of ensuring better income security for Ghanaian pensioners. The review culminated in the enactment of a new National Pension Act (Act 766) in 2008. The law establishes a new contributory three-tier pension scheme and a regulatory oversight body, the National Pension Regulatory Authority (NPRA), to oversee administration of the composite pension scheme.

Under the law, which remains in force today, 13.5% of an employee’s basic salary is paid to the Social Security and National Insurance Trust (SSNIT) comprising 13% contributed by the employer and 0.5% contributed by the employee) as tier one. The employee further pays 5% of his basic salary as tier two to an approved private trustee. Tiers one and two are mandatory. A third tier is voluntary, and like tier two, is managed by approved private Trustees, assisted by pension fund managers and custodians licensed by the Securities and Exchange Commission.

The law stipulates that within five (5) years of its enactment, the NPRA shall ensure unification of all other pension schemes operating in the country alongside the three-tier pension scheme. These allied pension schemes include Cap 30, Ghana University Superannuation Scheme, etc.

In spite of the comprehensive reforms birthed by the new Act, problems still persist with Ghana’s pension system.

First, coverage of formal pension remains low. For example, in 2017, only 14.3% of Ghanaian retirees had access to some form of formal pension, with preceding years recording even lower coverage. Second, the informal sector constitutes an abysmally low percentage of retirees receiving formal pensions. Third, pension coverage is disproportionately skewed in favour of men; for example in 2009, women accounted for only 14.9% of retirees receiving pension, constituting only 1.6% of the total female retiree population. Finally, and perhaps the most emphasised issue with pensions in recent times, is the low amounts paid to retirees as pensions.

Beyond the above-mentioned issues of general population access to pensions, the skewed rural-urban and gender distribution, and the low pensions, other pertinent policy questions remain. For example, how sustainable is the SSNIT pension scheme itself, considering that 1 in 2 contributors to the SSNIT scheme pays contributions on a salary of GH₵1000 or below? Why has unification of pension schemes not been achieved in spite of the provision in the law to attain unification by 2013?

In recent times, the subject of employee pensions has risen to the forefront of national debate and discourse. The Trades Union Congress (TUC) recently raised concerns with SSNIT’s computation of workers’ pension, a matter that was eventually referred to the NPRA. SSNIT has mounted a public education drive, assuring the public of the benefits of its pension scheme. For this year’s national May Day celebrations, TUC chose the theme: Sustainable Pension for All: The Role of Social Partners. In his May Day address, the President of the Republic, Nana Akuffo Addo, acknowledged the unresolved issues with Ghana’s pensions and directed the Minister of Employment and Labour Relations to liaise with the relevant institutions to bring finality to all outstanding issues within three (3) months.

Against this background, the IFS – a public policy institute devoted to undertaking research and advocacy on pertinent issues with Ghana’s economic management – recognizes a window of opportunity to influence the reforms necessary towards addressing the challenges with Ghana’s pension system. In this regard, the Institute plans to hold a National Pensions Dialogue to bring together experts, state agencies, civil society, development partners and the general public to discuss Ghana’s pension system. The event, scheduled for2nd July, 2019 has the following expected outcomes:

  1. To arrive at a shared understanding of the weaknesses with Ghana’s pension system from diverse perspectives – the consumers (pensioners and the general public), institutional suppliers (SSNIT, pension fund administrators, etc.), the regulator (NPRA), policymakers’ (Government) perspectives , etc.
  2. To identify grey areas with Ghana’s pension policy where further research is required.
  3. To harness ideas from stakeholders on how to strengthen pensions in Ghana, and old age social protection in general.
  4. To galvanise concerted efforts towards strengthening pension provision in Ghana.

A detailed report produced from the workshop will be submitted to the P residency and relevant authorities and organizations to contribute to the advocacy around the issues.

Click here for presentations: 1. Pension Reforms in Ghana: Rationale, Challenges and Way Forward    2. Pension Coverage and Benefits in Ghana


July 2, 2019

IFS National Pension Dialogue

IFS National Pension Dialogue In 2006, Ghana began a review of its pension system to identify ways of ensuring better income security for Ghanaian pensioners. The review culminated in the enactment of a new National Pension Act (Act 766) in 2008. The law establishes a new contributory three-tier pension scheme and a regulatory oversight body, the National Pension Regulatory Authority... Read more
November 7, 2018

Members of the National Assembly of the Republic of Burkina calls on IFS

A ten-member delegation of the National Assembly of the Republic of Burkina Faso has called on the Institute for Fiscal Studies IFS to gather first-hand knowledge and best practices in Ghana.

The purpose of the visit was to deepen the understanding of the delegation on the role civil society organizations play in ensuring effective monitoring and assessment of Ministries, Departments, and Agencies in Ghana.

Professor Newman Kusi, Executive Director of IFS in his welcome address to the delegation explained IFS’ work in promoting a better understanding of the Ghanaian economy and government finances in particular for the benefit of the government, parliamentarians, the business community, and civil society.

He emphasized the objectivity and independence of the institute in providing economic policy advice and advocacy based on practical experience and insights developed through quality research and analysis.

April 6, 2017

IFS Pre-Budget Forum 2017

1.0 Introduction The Institute for Fiscal Studies, IFS, held its annual Pre-Budget Forum for 2017 at the Kempinski Hotel in Accra on Monday, 13th February 2017 under the theme: “Towards a Healthy National Budget”.

The forum was attended by about 100 participants from diverse stakeholder organizations. These included: Members of the Finance Committee of Parliament; representatives of Ministries, Departments and Agencies; World Bank, IMF, USAID and other development partner organizations; Bank of Ghana; High Commissions and Embassies; Civil Society Organizations; the business community; and other stakeholder groups.

Seated at the high table were Hon. Dr. Kwabena Duffuor, the Founder and President of the IFS and a former Governor of Bank of Ghana, as well as a former Finance Minister; Mr Alex Ashiagbor, Chairman of IFS Governing Council and a former Governor of the Bank of Ghana; Prof. S.K.B. Asante, a member of the IFS Governing Council; Hon. Dr. Assibey-Yeboah, Chairman of the Finance Committee of Ghana’s Parliament; and Prof Newman Kusi, Executive Director of the IFS.

Prof Kusi, who chaired the function, delivered a keynote and welcome address to open the forum, after which two presentations were delivered to set the stage for discussions. The program was moderated by Bernard Naasara Saibu, a broadcast journalist with Starr FM.

November 5, 2015

IFS and NRGI host Budget 2016 Forum

The Institute for Fiscal Studies (IFS) and the National Resource Governance Institute (NRGI) jointly hosted a forum on the 2016 budget on November 5 at the Alisa Hotel in Accra. The theme for the forum was: Making the Most of Petroleum Revenues.

Nana Frimpong Anokye, Omanhene of the Agona Traditional Area and a Member of the Governing Council of IFS, chaired the event, which also had in attendance Mr. Alex Ashiagbor, the Governing Council Chairman, and Dr. Kwabena Duffuor, Founder of IFS.

In an opening address to the forum, Mr. Alex Ashiagbor said the main idea for the event was to examine the challenges and risks confronting the 2016 budget, what should be expected in light of the challenges and risks, and how natural resource revenues could be better managed to contribute to the sustainable growth and development of Ghana’s economy.