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Self-employed: SSNIT to enroll 750,000 onto scheme

90% self-employed do not have any form of social security cover

The Social Security and National Insurance Trust (SSNIT) to enroll 750,000 self-employed workers onto the scheme through an ambitious programme.

This number will be made up of 500,000 newly enrolled and the reactivation of 250,000 dormant contributors.

Only 32,000 self-employed contribute to SSNIT

Out of the 1.9 million (1,930,780) SSNIT contributors, only about 32,000, representing just 1.68% of active contributors, are elf-employed.

Director-General of SSNIT, Dr. John Ofori-Tenkorang, announced this at the launch of the initiative dubbed Self-Employed Enrolment Drive (SEED).

The initiative focuses on fulfilling the mandate of SSNIT to extend pension coverage to all workers especially, the self-employed.

It is to provide the self-employed with social protection, reduce poverty and over-dependence on benefactors.

9.9m working population

According to the 2021 Population and Housing Census, the working is estimated 9.9 million.

6.7m self-employed

Out of this 6.7 million are self-employed with 3.1 million falling between the age bracket of 15 and 45.

600,000 self-employed have some form of social security cover

Also, statistics from the National Pensions Regulatory Authority (NPRA) indicate that only 600,000 self-employed persons have some form of social security cover.

90% self-employed do not have any form of social security cover

This implies that about 90% of self-employed workers do not have any form of social security cover and would have to rely on the state or family and friends for financial support when they are old and retired.

Dependants to receive Survivors Lump Sum

Nominated dependants of members are also guaranteed protection in the form of a Survivors Lump Sum paid after the death of a member.

Objectives of SEED

SEED is an initiative that focuses on enrolling self-employed persons and workers in the informal sector on the SSNIT Scheme to contribute regularly on their full earnings.

The initiative provides social protection in the form of partial income replacement for the self-employed during old age and in the event of invalidity.

Nominated survivors of members who pass on also benefit from a Lump Sum payment.

SEED is essentially the Tier One product that has been repackaged to encourage the self-employed and informal sector workers to sign up for the SSNIT Scheme and also to continuously contribute on their full earnings for a guaranteed pension among other benefits.

Under SEED, guarantee contributors’ qualify for regular source of income (monthly pension) during old age until death.

It also offer disability insurance (Invalidity Pension) to contributors in the event of invalidity resulting from illness or an accident regardless of age.

Life policy

SEED provides life policy by paying the survivors of Members who pass on (Survivors Lump Sum).

Contributors exempted from NHIS

Contributors are exempted from paying National Health Insurance Scheme (NHIS) premiums.

The scheme is to assist in reducing poverty among the aged and ensure every worker has social protection.

Extensive stakeholders’ engagements 

Dr. Ofori-Tenkorang explained that in 2022 SSNIT carried out extensive engagements with various stakeholders across the country to solicit their input and support on how the self-employed can also have access to pension during retirement.
Valuable lessons

According to him, management gathered valuable lessons from the stakeholder engagements and the lessons learnt have helped to shape the rollout.

He is convinced that if self-employed workers get adequate information on the value SSNIT offers, they will happily join the Scheme.

SSNIT benefits higher than T-bills, similar investments

He noted that the value of SSNIT benefits is higher than the value provided by Treasury Bills and other similar investments.

Cause of small pensions

He noted that several employers who see SSNIT as a tax, and tried very hard to pay the barest minimum by pushing most employee entitlements into allowances and paying SSNIT contributions on minimal basic salaries snowballed into several pensioners receiving relatively small pensions.

This, he said made the Scheme unattractive, especially to the self–employed who are not obligated by law to join the Scheme.

Redefining social security in Ghana

The Director General of SSNIT is confident that SEED will help redefine social security in the country and give hope to the self–employed that they can also retire in dignity and comfort.

“We are going to rely heavily on the strengths of the Tier One product and once we have convinced the self–employed to look at SSNIT again, we will get them to sign up”.

They will sign up because what we are offering is an opportunity for them to insure their incomes so it can be replaced when they are old or become invalid and cannot work again. The same Scheme will also pay a benefit to their survivors if they pass on”, Dr. Ofori-Tenkorang stated.

Sad commentary of social protection system

He described the unbalanced coverage of workers as a sad commentary of social protection system saying SSNIT has the responsibility to change this narrative.

Payment channels  

He urged self-employed workers who have not registered under the Scheme to visit the nearest SSNIT office, contribute regularly on their right earnings using SSNITPAY – an electronic payment platform, via mobile money and debit cards.

“We will be reaching out to you in your offices, at the markets, at the trotro/taxi stations, various places of worship, on digital media and other platforms,” Dr. Ofori-Tenkorang assured.

On her part, the Board Chairman of SSNIT, Madam Elizabeth Ohene, noted that though delayed, she was happy that the launch of SEED took place during her tenure.

She expressed mixed feelings, pointing out that the nation has not paid attention to the provision of pension for the self-employed.

The fact that we are now doing this after more than 50 years of existence of SSNIT is simply not right. But, I am very excited and encouraged that we are finally doing so.

Only 11% of 2m people 60 years and above are on regular pensions

“To think that several millions of workers in the country have no assurance of monthly pensions during their old age is quite scary”, she noted

Report indicates that of the two million people in the country who are above 60 years, only 11% receive regular pensions.

What this means is that a lot of people in active service are burdened with taking care of their aged parents and relatives.

This trend is expected to continue if immediate steps are not taken to address it.

Deputy Minister of Employment and Labour Relations, Bright Wereko Brobbey, commended SSNIT for taking the giant step to provide pension cover for the self-employed.

He urged the Management of SSNIT to encourage contributors to periodically update their records.

“Most people after registration forget to update their records. So we have instances where people register at an early stage of their lives and after their death, it comes out that none of their children nor was spouse nominated. I will urge the Management of SSNIT to remind contributors to update their records,” he added.

The leadership of the various self-employed groups that were presents at the launch of SEED encouraged their members to prioritise SSNIT Pension and sign onto the Scheme to enjoy the benefits and income security.
GH¢365.01m paid to 235,617 pensioners in April

In April 2023, the Trust paid a total of GH¢365.01 million to some 235,617 pensioners.

The SSNIT Scheme replaces part of the lost income of Members due to Old Age, Invalidity or upon the death of a member, where nominated dependant(s) receive a lump sum payment.

It also pays emigration benefits to non-Ghanaian Members who are leaving Ghana permanently.

13.5% of declared salaries guarantees up to 60%

For 13.5% of declared salaries, members are guaranteed up to 60% of the average of their three years’ best annual salaries depending on the number of years contributed.

SSNIT Scheme is not an investment or savings scheme but an insurance for incomes and a pension plan that takes care of members in their old age or when they are declared permanently invalid.

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