The National Pensions Act is the seven hundred and sixty-sixth Act (Act 766) of the Parliament of the Republic of Ghana that was passed in 2008. The Act provides for pension reform in the country by the introduction of a contributory three-tier pension scheme; the establishment of a National Pensions Regulatory Authority (NPRA) to oversee the administration and management of registered pension schemes and trustees of registered schemes, the establishment of a Social Security and National Insurance Trust (SSNIT) to manage the basic national social security scheme to cater for the first tier of the contributory three-tier scheme, and to provide for related matters.
The contributory Three-Tier Pension Scheme is the new pension scheme that was introduced into the country following the promulgation of the National Pensions Act, 2008 (Act 766). The Three-tier pension scheme consists of:
The contributory three-tier pension scheme is managed as follows:
No. Under the National Pensions Act, 2008 (Act 766), every pension scheme has rules that prevent the assignment of benefits. However, a scheme (mandatory occupational pension scheme, provident fund or personal pension scheme) may allow a member to use that member’s benefit to secure a mortgage for the acquisition of a primary residence.
Yes, a contributor under the National Pensions Act enjoys the following tax benefits:
it shall, however, be subject to the appropriate income tax for contributors in the formal sector, who withdraw their benefits before ten years of contribution and before retirement.
Yes, an employer is permitted to choose its own pension Fund Manager and or Custodian ONLY if the scheme is an Employer-sponsored Scheme. However, if the scheme is a Master Trust Scheme, then the corporate trustee has the responsibility of choosing the pension fund managers and custodian.
A worker/contributor may withdraw his/her accrued benefits under the Third Tier under the following conditions:
No, it is the responsibility of the employer to select the trustee to manage the Second Tier mandatory Occupational Pension Scheme on behalf of its workers.
It is a multiple-employer scheme that allows different employers and their workers to join and is normally administered by a corporate trustee in line with the scheme rules approved by NPRA.
GLICO Pensions has two Master Trust Schemes with a large number of employers contributing to the schemes. Please refer to our products.
A member of a scheme who ceases to be an employee shall elect to have the member’s accrued benefits transferred to another scheme in accordance with the regulations of the scheme.
A Trust is an arrangement involving normally three parties of which one party entrusts the property/assets to another party to be transferred to the third party (beneficiary) at a point in time or a specified period.
It is a pension scheme that is work-based, established under a trust which provides benefits based on a defined contribution formula in the form of a lump sum that is normally payable on termination of service, death or retirement of a worker.
The minimum age at which a person may join the national basic social security scheme is fifteen years and the maximum age is forty-five.
It is an individual or corporate entity that holds property/assets on behalf of another person normally known as the beneficiary.
Contributions to the Three-tier Pension Scheme are as follows:
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