We have answers to all your questions.

This new pensions law provides for the establishment of three tier pensions with the following structured contributions:

  • Mandatory 13.5 % of basic salary towards payment of retirement pension.
  • Mandatory 5% of basic salary, fully employee funded scheme, managed by a trustee or body
  • Up to 16.5% voluntary contribution of basic salary. The establishment of a regulatory body called
    the National Pensions Regulatory Authority(NPRA).
  • The reduction of the minimum contributory period to enjoying pensions from 240 months to 80

The contributions into all the tiers are tax exempt, i.e. contributors under this regime enjoy tax reliefs.

  • Contributors enjoy the compounding effects of interest rates over time, in that the scheme is managed over the working life of the contributor. Contributors also enjoy a more responsive customer service of the private sector.
  • Improved Security of contributor’s fund. The law prohibits the attachment of the returns on the investment in the execution of a judgment debt or such returns being used as a charge, pledge, lien, or being transferred, assigned or alienated by or on behalf of the member.
  • Payment of contributor’s lump-sum has moved from SSNIT to the corporate Trustee and this is based on the performance of the fund.

A trustee is an individual or corporate body in a position of trust who holds property, authority, or a position of trust or responsibility for the benefit of others.

  • In relation to pensions, a trustee (corporate trustee) is any entity which administers pensions schemes to organisations and individuals, receives their monthly contributions and pays out benefits to contributors upon retirement(eg. SSNIT, Pensions Alliance Trust, etc.)

At any age that guarantees the contributor to making the minimum contribution of 180 months.

According to Act 766, all contributions of persons before the promulgation of the Act, who will retire aher year 2020 shall receive pass credit in respect of their lump sum (25O/i) determined by a formula agreed between the Pensions Reform Implementation Committee and the Trust based on actuarial assessment.

According to the new amendments to the law, contributors who shall receive their lump sum under the new law shall be contributors who were 50 years by January 1, 2010 when this law becomes operational.

The first batch of beneficiaries under this reform will be the group of employees who retire in January 2020.

Under PNDC Law 247, a contributor who makes 240 months un-blemished contributions shall enjoy full
pensions (i.e. lump sum and monthly stipends). In the event that this criteria is not met, the contributor is paid a lump sum of his contributions and accrued interest, but does not receive monthly stipends, i.e. a half pension. Under Act 766, a member enjoys full pensions aher making the stipulated 180 months contribution before retirement. In the event that the contributor makes less than the stipulated, the
contributor is paid all of his/her accrued contribution and 75% of the accrued interest using the
90-day Treasury Bill as a benchmark.

The tier two (2) is the portion of the contributor’s compulsory pensions fund that is managed by a trustee towards payment of employee’s or contributor’s lump sum upon retirement. This is 5% of the employee’s basic salary.

No. Contributors can access their funds only when they are due for early retirement at age 55 or compulsory retirement at 60, or have been declared as invalid by a qualified medical officer.

e are bonded by the law and our own commitment to protecting the future of the Ghanaian worker hence there should be no fears of getting paid when a contributor achieves his/ her retiring age.

As administrators of the scheme, PAT can charge a maximum of 1.33O/o of the Asset under Management
as fees per Annum, and 2.504 in the case of master trust scheme.

PAT is a licensed Trustee responsible for paying employee’s lump sum, whiles SSNIT on the other
hand is responsible for paying employee’s Pension, when they are on retirement.

The Lump-sum is a one-time payment and PAT does not have any obligation to the contributor after it is paid unless the contributor opts to take their lump sum in annuity pension with Pensions Alliance Trust Limited.

The lump sum is not calculated. It is the sum of all contributions of the member and the accumulated interest.

Their contribution in the TPFA has been worked out and paid to them by SSNIT. In the event that there are arrears in the TPFA, they will be contacted later to receive it.

The Act prevents the assignment of benefits, however a member of a scheme is allowed to use his/her benefits to secure a mortgage for the acquisition of primary residence.

Every contributor to the Tier 2 scheme enjoys a tax relief meaning contributors to tier 2 contributions are exempted from any income tax assessment.