Pension Fund Ssnit

PUBLIC PENSION FUND MANAGEMENT IN GHANA

Prepared by: Henry DEI SEPTEMBER 2001

PENSION FUND MANAGEMENT IN GHANA

CONTENTS 1.0 INTRODUCTION 2.0 SOCIAL SECURITY AND NATIONAL INSURANCE TRUST (SSNIT) 3.0 ACTUARIAL PROJECTIONS

4.0 INVESTMENT POLICY 5.0 FINANCIAL VIABILITY 6.0 INVESTMENT MODEL 7.0 DEVELOPMENT ORIENTED INVESTMENTS 8.0 MANAGEMENT

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1.0 INTRODUCTION. Historical Development of Social Security in Ghana. Historically in Ghana there existed a traditional system of social security amongst the rural folk that ensured that the extended family had the responsibility of taking care of the aged, the infirm and in the final analysis the dead in the community. The advent of modern society that is highly migratory and the introduction of social security have disrupted this traditional extended family system of care, as we now know it. The missing link however is that some sections of the population have been missed out in the provision of social security in the transition from the rural extended family care to the modern social security and these are the people working in the informal sector and to some extent the rural folks. These people unfortunately form the majority of the population and the challenge is to design schemes to cater for the needs of this broader sector of the population. The introduction of pension in Ghana dates back to the colonial times when Government introduced pension for a select group of civil servants who were known as pensionable officers. In the early sixties Government established a more national scheme to cover all workers both in the private and public sectors. The scheme was initially started as a Provident Fund to provide lumpsum payments for old age, invalidity and survivors benefits. During this period the funds generated from the contributions were invested in special government bonds with very low interest rates and very long maturity periods. As a result of the low interest rates and the rising inflation at the... [continues]

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