The Social Security and National Insurance Trust (SSNIT) has increased monthly pension payments by 12% in line with its annual indexation processes.
This increment which is effective January 2025 is in consultation with the National Pensions Regulatory Authority (NPRA) and in line with Section 80 of the National Pensions Act, 2008, (Act 766).
To this end, all valid pensioners on the SSNIT pension payroll as of the end of December 2024 will have their monthly pensions go up by an average of 12%.
This will be made up by a fixed rate of 8% plus a flat amount of GHS 72.58, which is the balance of 4% that is to be redistributed.
The lowest-wage pensioner would receive GHC396.58 as a result of the increase. This represents a 32.19% increase above the 2024 minimum pension payment.
The highest-earning pensioner under PNDCL 247 and Act 766 will now receive GH¢201,792.37 and GHS 28,703.01 per month respectively.
SSNIT undertakes this upward adjustment to maintain the real value of pensions to ensure that beneficiaries can better cope with economic pressures.
Why Indexation?
The primary objective of the indexation is to maintain the purchasing power of pensioners.
SSNIT as prescribed by law works with NPRA to arrive at the right indexation rate for pensions every year. Indexation of pensions is thus an annual requirement by law.
“The Trust shall annually review the pension payment which shall be indexed to wage inflation rates of active contributors or another rate determined by the Trust in consultation with the Board of the Authority”
As part of its mandate, SSNIT ensures that retired members under the Scheme receive their pensions monthly and their pensions are indexed annually.
The rate of indexation for pensions therefore depends on:
- Average salary of active contributors from the previous year.
- Annual average Consumer Price Index (CPI) from the previous year.
- Affordability and the impact of indexation on the cost of pensions to the Scheme.
- The effect of indexation on the long-term sustainability of the Scheme.
