We are delighted to be here today, in this fast developing oil city, to open a zonal office for the National Pensions Regulatory Authority (NPRA). On behalf of the Government, Management and Staff of the NPRA, let me warmly welcome you to this ceremony.
Today’s occasion marks another milestone in the history of the NPRA and pension administration in Ghana as we open yet another zonal office, after successfully opening one in Kumasi and Tamale last year. The opening of the Takoradi office, further re-enforces the NPRA’s efforts to decentralize its activities to be closer to workers in both formal and informal sectors, including other major stakeholders, especially NPRA Service Providers.
Ladies and gentlemen, the NPRA is dedicated to protect and safeguard pension funds and in so doing, secure good returns on workers contributions. After workers dedicating years of their life to serve this nation in diverse ways, it behoves on the nation to reciprocate, by putting proper structures and systems in place to ensure retirement income security for its citizenry.
As we are well aware with the coming into force of the National Pensions Act, 2008 (Act 766) as amended, CAP 30 and related parallel schemes are expected to be unified under the 3-Tier Pension Scheme within five (5) years. Hence by implication, these schemes should have ceased to be in force by 1st January, 2014. Notwithstanding the elapse of the period, the Authority is still pursuing and will ensure that all parallel pension schemes are unified as provided in the Act.
The Total Assets under Management for Private Pension Funds as at 31st May, 2017, was about 7.4 billion Ghana Cedis with about 2.7 billion Ghana Cedis in the Temporary Pension Fund Account (TPFA).
The pensions industry as at today has a total of 131 Service Providers including Trustees, Pension Fund Managers and Custodians with two hundred and forty-three (243) registered pension schemes operating.
The Authority is closely working towards the transfer of contributions of Public Sector Workers in the TPFA. A number of progressive meetings have been held with key stakeholders including the trustees of the public sector schemes, their administrators and the Controller and Accountant General’s Department. This is important to ensure the finalization of due processes for a smooth transfer of funds into their respective scheme custodial banks, for continued investment under the NPRA prescribed investment guidelines.
The Authority, as at the end of 31st May, 2017 had successfully transferred an amount of GHS 547,638,012.40 from the TPFA representing, contributions of 250,799 private sector workers under 7,707 employers.
While efforts are being made to transfer the accrued contributions in the TPFA, trustees of the following public sector schemes; Hedge Master Trust Scheme, GES Occupational Pension Scheme, Health Services Workers’ Occupational Pension Scheme and Judicial Service Occupational Pension have received GHS 219,708,757.86 which covers 5% 2nd Tier contributions under Public Sector Workers, for the period of September, 2016 - April, 2017. Also, the Authority began transfer of monthly 2nd Tier contributions in March 2017 to the scheme custodial bank of the Electoral Commission which is a government subvented institution, but does not belong to any of the four (4) registered major Public Sector Schemes, after they successfully joined a Master Trust Occupational scheme, managed by a Corporate Trustee upon completion of all due processes.
I urge you to support the Authority in its educational and sensitization campaign, especially among the Informal Economy Sector Workers or the Self-Employed to bring them on board the 3rd scheme. Some incentives have been earmarked by the Authority with the objective of promoting the coverage of the informal sector workers and it is the Authority’s hope that, more Corporate Trustees will leave their comfort zones and venture fully to improve coverage under the 3rd tier informal sector space.
These incentives includes;
- Waiving NPRA fees of 0.33% on Net Asset Value for two (2) years to be distributed as follows:
Trustee fee: 1.49%
Reduction in total fees: 2.33%
The rational is to make more funds available for Trustees by increasing their fees and also match up contributions of members by reducing the total fees from 2.5% to 2.33%
- Fixing Pension Fund Managers and Custodians fees to 0.56% and 0.28% not negotiable. The rational is to enable them to have enough funds to effectively perform their assigned roles to ensure prudent management of the funds.
- Reducing Informal Sector Scheme registration fee from GHS 5,000.00 to GHS 1,000.00. The rationale behind this is to encourage high participation of Corporate Trustees and to maximise the coverage of persons in the informal sector.
- Reducing Individual Trustee Informal Sector licensing fee from GHS 5,000.00 to GHS 500.00 to encourage High trustee turnover for schemes which would lead to good governance of the scheme.
Ladies and gentlemen, the opening of this zonal office today, is part of our quest to deepen awareness and visibility of the Authority and to bring pensions administration closer to all stakeholders. We hope that the general public will be more receptive and feel secure in cooperating with the Corporate Trustees, who have been duly licensed and also present here in Takoradi. We believe this will boost their determination to succeed in this pension environment through improved coverage and compliance levels, as they register 2nd and 3rd Tier schemes. We appreciate your coming to witness the opening. We also thank the distinguished people of Takoradi for receiving us on their land so warmly.
May I wish the staff of the Zonal Office every success in ensuring the successful operations of our activities for the benefit of workers in both formal and informal sectors under the 3-Tier Pensions Scheme to ensure retirement income security.