Pensions and life after retirement has been a major headache for most Governments around the world because without an elaborate plan to take care of every Nation’s aged, they will eventually become a burden on the State. That is why laws are enacted by Governments around the world to make pension contributions compulsory for all Workers in permanent employment within an economy.

However, retirement income from Government controlled or semi-controlled pension schemes over the years has proven to be woefully inadequate to sustain the livelihood of our Pensioners after retirement in terms of food, clothing, shelter, healthcare and other things that Pensioners should engage in to enjoy the restof their life after retirement.

In Ghana, this challenge compelled the Government of Ghana to come up with the National Pensions Act, 2008 (Act, 766) to reform the Ghanaian Pension System& Administrationwhich was wholly controlled by the Social Security & National Insurance Trust (SSNIT) with the aim of giving Pensioners much enhanced benefits after retiring from active service for a better retirement income security.

As laudable as this was, the management of the Tier 2 Pension for the public sector workers was embroiled in controversy between Labour unions and Government which up till today has stilled not been resolved completely in terms of access to the funds for the needed investments.

This is denying public sector workers the enhanced benefits they are supposed to be looking forward to when they retirebecause of the loss in investment returns. The challenges with the Tier 2 Occupational Pension Scheme Management with the public sector especially coupled with the challenges being faced by SSNIT with the Tier 1 Management makes income security for today & tomorrow’s Pensioners highly unpredictable in Ghana.

With a huge Informal economy which employs majority of the Ghanaian working population, the issue of pension & retirement income security becomes direr because workers in this sector are not compelled by law to make compulsory contributions to any pension scheme. Most of these workers never retire from active service until they are incapacitated or dead.

At this stage if the social and family support system fails, then they become paupers and a burden unto the State. With majority of them earning more accumulated income in a month than even most Civil & Public Servants, their education & training in pensions has become quiet urgent and necessary in order to reduce the number of our senior Citizens that the Government of Ghana through the Women & Gender Ministry is forced to put on the Livelihood Empowerment Against Poverty (LEAP) program which is costing the State millions of Ghana cedis a year and clearly unsustainable going forward.

For a better income security and for the Ghanaian worker in the public or civil service to stop using all sort of means to remain at post for another five or more years after age sixty (60) and to reduce the number of our aged on the LEAP programme who most often than not were informal sector workers, Ghanaians need to start thinking and implementing a Personal Pension Scheme/Plan (PPS) during their working life. This will help greatly in building enough funds for a sustainable livelihood as a Pensioner after retirement.

Government, Unions, Associations, Pension Consultants, NGOs and individual Ghanaians must all help in creating the necessary awareness for all workers to understand that having a PPS is the surest way to secure a for a better life for all Pensioners or maintain their standard of living after retirement.

Through training, advocacy and advisory services, we have to help in lifting the Ghanaian future Pensioners in the public and private sectors out of poverty after years of service to mother Ghana and stem the trend where some Public & Civil servants try to change their date of birth or use other means in order to stay on working for another five or more years.

For those in the Informal sector, Sole proprietorship businesses& SMEs, we have a responsibility as a State through various channels to make them understand and appreciate that you can be a Barber, Seamstress, Electrician, Mechanic, Coconut seller, etc and still retire decently at age sixty or earlier with an elaborate Personal Pension scheme/plan in place for you.

This will go a long way to reduce the pressure on family members to care for their aged relations and also the pressure on the Government of Ghana to expand the LEAP programme which should not be the case because with a well-planned & elaborate PPS in place for every worker especially for those in the informal sector, LEAP should be a thing of the past in Ghana.

Written By: Badu-Boateng Ernest (Managing Director/Consultant), Incas Labour & Pension Consult, Kumasi – Ashanti. Ghana – West Africa.