The Past Credit is the contribution of workers to SSNIT before the coming into force of Act 766, which brought about the three-tier pension scheme.

The National Pensions Regulatory Authority's (NPRA) has directed SSNIT to re-compute the interest on the past credits.

However, Dr Ofori-Tenkorang said in implementing the directive, the Trust's Past Credit liability would increase to GHS5.87 billion as at October 2019, representing an increase of GHS4.5 billion.

This, he said, would put the SSSNIT Scheme into a financial crisis from 2022 when the fund ratio would have dropped from 3.1 to 0.3.

Dr Ofori-Tenkorang was briefing the media to address issues raised by the Forum for Public Sector Registered Pension Scheme (FORUM) on the calculation of Past Credit.

The FORUM had accused the SSNIT of foot-dragging with the implementation of the modalities for the Past Credit.

It said SSNIT was reluctant to "come out with modalities for the calculation on Past Credit earned as of December 2009, based on a 100 per cent Treasury Bill rate compounded quarterly, and the issuance of statements to each contributor".

But the Director-General said the implementation of the three-tier pension scheme  (Act 766), made provision for the Trust (first tier operator) to pay monthly pensions and the second tier fund managers to pay the lump sum, which hitherto was being paid by the Trust under the Social Security Law (PNDCL 247).

However, there were workers affected by Act 766 who as at December 31, 2009 had contributed to the SSNIT Scheme, thus, they had contributed 17.5 per cent of their salaries to SSNIT, which was four per cent more than the current 13.5 per cent.

Dr Ofori-Tenkorang said as at 2010 when the Act became operational, it permitted SSNIT and NPRA to dialogue on how best to calculate the Past Credits.

The dialogue continued from 2010 to 2015, after which the NPRA on March 24, 2015, asked SSNIT to submit a report by March 31, 2015 for the determination of the Past Credit to NPRA for onward transition to the NPRA Board.

NPRA further wrote to SSNIT on September 9, 2015 that it had agreed to the formula proposed by SSNIT  and that the formula shall be based on four per cent of the members' annual salary accumulated from the date the member joined the SSNIT Scheme to the implementation date of the National Pensions Act, 2008 (Act 766).

The Director-General said the only issue on which the NPRA did not agree with SSNIT was the interest, which should be used to further accrue the determined Past Credit from January 1, 2010 till the date of retirement.

SSNIT had proposed 50 per cent of the Treasury Bill rate but NPRA suggested 75 per cent of the rate.

He said NPRA's directive was contrary to what had already been lawfully determined by the bodies vested with the Authority to do so, as per section 94 (1) (d) of Act 766.

He said the directive also ignored the fact that the formula both SSNIT and NPRA settled on to calculate Past Credit as at December 31, 2009 was arrived at after series of deliberations between both parties.

Also, the said directive failed to provide any actuarial justification as required by law in determining the Past Credit.

Subsequent to the directive, the SSNIT and NPRA Boards met on November 19, 2019 together with the Labour represented on both boards to discuss the issue.

The NPRA requested SSNIT to produce an actuarial valuation of the Scheme by December 3, 2019 for their consideration.

Dr Ofori-Tenkorang said the Trust remained committed to enforcing Act 766 and the agreement reached by all parties (including the FORUM), and would accurately and promptly pay all benefits due members as and when they retired.

"Management of the Trust is currently using 100 per cent of the prevailing 91-day Treasury Bill rate to compute interest on the Past Credits every quarter from January 1, 2010.

"This in line with the Agreement by the Ministry of Employment and Labour Relations, the Ministry of Finance, NPRA, SSNIT and the FORUM, and it has been made available to Members on their Statement of Account".