Ghana, like most countries, has introduced comprehensive reforms to its pension system, leading to the establishment of a new three-tier pension structure in 2008. This paper looks at the general concept of pensions from the basics and is intended to serve as a source of reference for subsequent papers on pensions. It considers the rationale for pension systems, the types, and models of pension provision, including a review of the two models of pension systems by two leading international organizations; the World Bank and the International Labour Organisation (ILO).
It also discusses the three criteria normally used to classify pension systems around the world: (1) how the coverage is decided (employment-related, universal and means-tested); (2) how benefits are calculated (defined contribution or defined benefit), and (3) how benefits are financed (pay-as-you-go or fully-funded
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