If the recent actuarial valuation assessment is any indication, the Social Security and National Insurance Trust (SSNIT) may not be able to completely pay pensioner benefits after 2037, according to the Africa Centre for Retirement Research (ACRR).
According to the think tank, the scheme's medium- to long-term viability is in jeopardy.
Abdallah Mashud, the Executive Director of ACRR, told journalists on Wednesday, November 24, that if required steps are not made, Ghana's social security plan will collapse.
Mr Mashud referenced a 2014 actuarial valuation assessment that predicted SSNIT's finances will be depleted by 2042.
"However, three years later, that is, the subsequent appraisal in 2017," he told media, "the reserves [will] deplete in 2037, five years early."
"What this means is that the Trust funds will be unable to pay full planned payments on time in 2037 if Parliament, policymakers, and stakeholders do not take the necessary steps to redress the imbalance in the social security finances through parametric and legal adjustments."
There have been suggestions that the retirement age be raised from 60 to 62 years, preferably by 2037.
"However, the ACRR believes that, given the post-retirement death trend of SSNIT pensioners, raising the retirement age by two years will result in more members dying in service rather than in pension," he stated.
He urged the government to pay off its debts to SSNIT instead.
"Government debt to the Trust continues to wreak havoc on the scheme's compliance rates and long-term viability."
"Delays in the government's payment of due payments have been mentioned in actuarial valuation assessments as a factor limiting the scheme's investible funds."
He is concerned that the effects of the Covid-19 pandemic will have a negative impact on retirees and Ghanaian workers in general in the forthcoming actuarial value report.
"The data for the next actuarial valuation study will be from January 2018 to December 2020." For starters, given the financial market impact of the Covid-19 epidemic, the Trust may as well record another fiscal year loss on its investments.
"Secondly, the rate of increase in the elderly population continues to outpace the rate of increase in the contributor population. Evidently, the number of workers contributing to a pensioner's assistance has decreased even more, from 9 in 2013 to 7 in 2020.
"As a result, for the time, based on income-expenditure dynamics and other variables.
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