The Social Security and National Insurance Trust (SSNIT) has increased pensions for 2023 by 25 per cent.
This represents a 150-per cent increase over the 10 per cent increment last year.
With the new increment called pension indexation and sanctioned by the National Pensions Act 2008 (Act 766), the low pension earner who takes a monthly pension of pension GH¢300.00 from the beginning of this month will take a monthly pension of GH¢ 430.58, representing an increase of 43.53 per cent.
Also, the highest monthly pension earner of GH¢ 142.564.97 will take a monthly pension of GH¢169, 725.89 representing an increase of 19.05 per cent.
Indexation of pension according to SSNIT is a technique used to adjust pension payment to help maintain purchasing power.
The Director-General of SSNIT, Dr John Ofori-Tenkorang, who announced this in Accra yesterday said the increment was in line with the SSNIT Act, 2008 which enjoins the Trust to index pension every year in line with inflation trends and sustainability of the scheme.
He also said the increment was done in consultation with the National Pensions Regulatory Authority.
Dr Ofori-Tenkorang said that the 234,000 pensioners on the SSNIT Pension Payroll as of December 31, 2022 would have their monthly pension increased by a fixed rate of 19 per cent plus a redistributed flat amount of GH¢73.58.
He explained that redistribution was a mechanism applied to the indexation rate to cushion low-earning pensioners in conformity with the solidarity principle of social security.
"The effective increase in pensions would therefore range from 19.05 per cent for the highest-earning pensioner to 43.53 per cent for the lowest-earning pensioner," the Director-General stated.
Accordingly, he said the highest-earning pensioner as of December 31, 2022 would receive GH¢ 169,725.89 per month in 2023 and the lowest-earning pensioner as of December 31, 2022 would have his / her monthly pension increased from GH¢300.00 to GH¢438.50 in 2023.
"The SSNIT Scheme, like any other defined benefit scheme, pays pensions which mirror the earned salaries on which contributions were paid," Dr Tenkorang stated.
Dr Ofori-Tenkorang explained that the new pension indexation would cost SSNIT GH¢850 million in pension benefits payment this year.
Last year, the Director-General said SSNIT paid more than GH¢3. 6 billion on pension benefits.
Sign up for free AllAfrica Newsletters
Get the latest in African news delivered straight to your inbox
Dr Ofori-Tenkorang disclosed that including the payment of pension, survivors benefits, and lump sum, SSNIT would pay pension benefits of GH¢5 billion in 2023.
The Director-General of SSNIT assured that the management of the Trust would continue to work hard to guarantee positive annual indexation for pensioners bearing in mind the long term sustainability of the scheme.
"The Trust remains committed to paying out legitimate benefits accurately and timely," Dr Ofori-Tenkorang said.
The General Secretary of the National Pensioners Association, Stephen Boakye, said the 2023 pension increment was the highest pensioners had received in the history of the scheme.
He commended SSNIT for the increment.
Mr Boakye urged workers to take pension issues seriously while in active service.
The General Secretary of the National Pensioners Association also entreated employers to pay promptly the monthly pension contributions of their staff.
