Government Settles 50% of GHS 5 Billion Debt Owed to SSNIT
The Government of Ghana has made progress in settling its debt obligations to the Social Security and National Insurance Trust (SSNIT), defraying approximately GH₵2.5 billion of its GH₵5 billion arrears in the form of bonds. This move, disclosed by SSNIT’s Director-General, Kofi Osafo-Maafo, followed extensive negotiations aimed at stabilizing the pension fund’s finances.
An independent actuarial review of SSNIT’s financial position highlighted the adverse impact of delayed government payments on the fund’s investment portfolio. As of December 2021, SSNIT’s total outstanding debt stood at GH₵9.3 billion, with government accounting for GH₵6.9 billion of this, or roughly 75% of the total. This burden has resulted in a 1.3% annual decline in the Trust’s investment returns, exacerbating concerns over its long-term sustainability.
Addressing stakeholders in Kumasi, Mr. Osafo-Maafo noted that the recent payment marks a significant step towards resolving the longstanding issue. “This is not a new debt; it has accumulated over more than a decade. However, through continuous engagement with the government, we have secured this repayment of GH₵2.5 billion,” he said.
Despite the challenges posed by the government’s arrears, SSNIT reported a turnaround in its financial performance, achieving a net surplus of GH₵864 million in 2023, reversing deficits from earlier years. The Director-General attributed this to improvements in contribution collections, investment income, and cost efficiency.
Joseph Poku, SSNIT’s Chief Actuary, emphasized the Trust’s focus on generating additional contributions and managing its investments prudently to ensure the long-term viability of the scheme. “We are taking all necessary steps to bolster our funding position, ensuring we have excess funds to invest and drive returns,” he said.
The Ashanti regional chair of the Pensioners’ Association, Adarkwa Tuffour, underscored the need to strengthen SSNIT’s role as a critical social safety net. “SSNIT is vital to the livelihoods of many Ghanaians. Safeguarding and improving the scheme is essential,” he remarked.
