The National Pensions Regulatory Authority (NPRA) has said it plans to roll out a Diasporan Pension Scheme, targeted at Ghanaians living abroad, in a bid to give them something to fall back on when they decide to retire back home.
Chief Executive Officer of the pensions regulator, Hayford Attah Krufi, told the B&FT that as much as 10 percent of Ghana’s population lives outside its borders and a good number of these people desire to retire home when they are no longer working, which makes it imperative for them to have a pension back home.
Mr. Krufi said the Diasporan Pension scheme will be a win-win situation for the country as it provides a huge capital pool for investment, and a pension savings for the contributors when they return home.
“The homecoming for diasporans will not be complete without building up some investment at home in the form of pensions that they can retire to,” he said.
“The diaspora is worth its gold and if this missing jigsaw piece is not added in Ghana’s transformation, we will always fall short of capital infusion.”
The NPRA, he said, is currently looking for corporate trustees in order to make the scheme, which he described as “pay as you go” active.
“It is voluntary, with the levels set up by your ability to pay and it will be tax free. It is savings which translate itself in compounded capital and investment, and being a contributor, you will also be assisting significantly in the economic development of the country.”
He explained further that the scheme will be a provision for old-age poverty alleviation and contributors can join from any part of the world and the scheme can be accessed for draw down from the age of 55 upwards.
“As regulators of the pension industry, we have robust compliance procedures to ensure that the investment is looked after safely.
As part of our regulatory functions, we visit the premises of licensed corporate trustees and other pensions service providers to ensure that scheme account statements, receipts for collections, investment portfolio reports, custodian report on assets, minutes of trustees meetings, investment committee reports and all IT infrastructure are all up to speed to ensure the safety and sustainability of the scheme.”
A number of vehicles would be available for interested contributors, including the Master Trust Provident Fund Scheme, Group Personal Pension Scheme or Personal Pension Scheme.
The schemes would then be registered and managed by Trustees who are already licensed by the NPRA.
The scheme, he said, will be designed to have a representative of the Diasporan Relations Office at the Office of the President to sit on its board of trustees.
He urged Corporate Trustees to embrace the new scheme and begin to look beyond Ghana for contributors who will be interested in voluntary contributions under the Tier 3 pensions arrangement.
Already, Ghanaians living abroad remit a lot of money, estimated at US$4billion per annum, for various purposes, including taking care of family members, real estate projects and other forms of investment.
“They are the richest constituency and yet the most deprived when it comes to pension provision.
As a nation, our quest for investment will be skewed if we do not provide for their pension or retirement income security,” Mr Kafui said
Source: B&FT Online