Thirteen institutions are set to be prosecuted by the National Pensions Regulatory Authority (NPRA) for failing to honour the mandatory payment of pension contributions for their workers.
The thirteen will be the first casualty after the Authority was given the power to prosecute defaulters.
Speaking to Citi News, the Chief Executive Officer of the NPRA, Hayford Attah Krofi, said the Authority will in the coming months go after more defaulting institutions.
“Investigations are very far advanced. Preparatory works have been done. We have trained nine of our compliance and legal officers who are now preparing to take these defaulting employers to court for their prosecution.”
“There are some who since our compliance officers visited have made good on the payments that they had defaulted and they have also added the three percent penalty but we still have 13 of them who are very recalcitrant and these are the ones were are processing for court.”
After reforms in the pensions sector initiated by the Government in July 2004 and subsequent adoption of most recommendations from a report by a Presidential Commission on Pensions under the chairmanship of T. A. Bediako, the contributory Three-Tier Pension System was introduced.
This was to be funded by direct contributions of employers and employees to, replace existing parallel pension schemes.
But pension managers have over the years lamented the non-compliance of many employers.
Per the NPRA, the new contributory three-tier pension scheme comprises two mandatory schemes and a voluntary scheme as follows:
- a first tier mandatory basic national social security scheme which will incorporate an improved system of SSNIT benefits, mandatory for all employees in both the private and public sectors;
- a second-tier occupational (or work-based) pension scheme, mandatory for all employees but privately managed, and designed primarily to give contributors higher lump sum benefits than presently available under the CAP 30 and SSNIT pension scheme; and
- a third tier voluntary provident fund and personal pension schemes, supported by tax benefit incentives to provide additional funds for workers who want to make voluntary contributions to enhance their pension benefits and also for workers in the informal sector.
- It is important to underline that provision has been made in the 3rd-Tier voluntary Personal Pension Scheme to cater for the peculiar needs of workers in the informal sector of the economy which covers about 85% of the working population.