SSNIT grapples with GHS 477m unrecovered debt from Fund Managers
The 2022 Auditor-General Report has shed light on a significant financial challenge facing the Social Security and National Insurance Trust (SSNIT), with several fund managers owing a staggering ¢477.288 million as of the beginning of 2021. Despite SSNIT receiving ¢6.076 million in repayments during the year, the outstanding balance remains a matter of concern.
In response to this financial predicament, the Auditor-General has recommended that SSNIT’s management take proactive measures by collaborating with the National Pensions Regulatory Authority (NPRA) to ensure prompt and complete remittance of the unpaid debt by the fund managers. The urgency of the situation necessitates decisive action to safeguard the Trust’s financial health.
Furthermore, management has acknowledged an existing advance mobilisation debt related to Antgya Ghana Limited. Until SSNIT recoups the full repayment from Antgya Ghana Ltd, the advance mobilisation amount will remain in effect. Management vows to implement stricter controls on subsequent advance mobilisations paid to contractors, aiming not to exceed the 15% threshold of the contract sum to prevent future liabilities.
The Auditor-General’s report delved further into SSNIT’s investment strategies, highlighting the potential for enhancement of the Trust’s liquidity position through the Short-Term Treasury Sub-Asset Portfolio. However, the report pointed out a recent underperformance, with the Trust falling short of its investment target of 6%.
An insightful analysis of investment allocations to the Short-Term Treasury for five years revealed an interesting trend. While SSNIT’s Total Investment Portfolio displayed an upward trajectory, allocations to the Treasury Sub-Asset Portfolio exhibited relative decline.
In light of this finding, the Auditor-General has recommended that SSNIT’s management bolster the investment outlay in the Treasury Sub-Asset Portfolio to fortify its liquidity reserve, thereby bolstering support for the Trust’s overall financial stability.
As SSNIT navigates these challenges, market observers and stakeholders will closely watch the Trust’s responses and strategies to address the unrecovered debt and optimize its investment performance. The actions taken by SSNIT’s management in the face of these recommendations will be critical in shaping the Trust’s financial resilience and safeguarding the interests of its members.
