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The Public Agenda has uncovered yet another reflection of the hard economic times that Ghanaian businesses are confronted with.

This is the inability of most businesses to meet their statutory obligations to make contributions to the pensions of their employees, as required by the National Pensions Act, 2008 (Act 766).

In a media encounter last week, the Takoradi Area Manager of SSNIT, Dr. Prosper Ayisah, disclosed that, as at the end of April 2016, the Takoradi Office had a total of 4,406 registered employers with a total labour force of 62,347. However, only 1,639 employers representing 37.2% made contributions on behalf of 27,979 representing 44.9% employees.

The revelation reinforces the widespread view that the existing Ghanaian business climate is stifling employers and deterring the recruitment of new staff, as such recruitment imposes additional cost burden on the businesses.

A Graphiconline report posted last year disclosed that business surveys conducted by the Bank of Ghana (BoG), Institute of Economic Affairs (IEA) and the Association of Ghana Industries (AGI) had revealed increasing concerns over the deteriorating business environment and the worsening state of business confidence leading to job losses.

The BoG business confidence index, according to the report, showed a dip from 99.2 per cent in December 2014 to 88.9 per cent in March 2015.

For the AGI, its 2015 first quarter Business Barometer Survey showed a dip in business confidence by 13 points from 98.0 to 85.0, signaling a potential for a lot more job losses.

The AGI survey revealed that, businesses were neither absorbing job-seekers nor were they sure of doing so. About 50 per cent of CEOs interviewed said their employment levels would remain the same, while 27 per cent said they are sure to lay-off workers.

The Institute of Economic Affairs’ survey was even more revealing, as thirty-four per cent of businesses in the country were reported to have laid-off workers in the preceding six months due to the power crisis, overburdening taxation, and the cedi’s depreciation.

Dr Ayisa’s encounter with the media was to afford SSNIT’s stakeholders in the Takoradi metropolis the opportunity to know more about social security issues and also to entrench the culture of pension contributions in the country.

It also afforded the media the opportunity to ask all the relevant questions relating to the operations of the first tier pension scheme.

The SSNIT Area Manager for Takoradi disclosed that, his outfit has instituted innovative and aggressive measures to reduce establishment indebtedness to the barest minimum.

He explained that, defaulting employers would be prosecuted in the various courts, adding, it would improve compliance by discouraging employers who have defaulted in registration, contributions, report submission and payment.

Public Agenda’s independent investigations into the reasons for the mass default in respect of SSNIT contributions however revealed that a large number of employers were struggling to pay salaries.

In some instances, salaries have been in arrears for a year or more. The dilemma for some of the employers interviewed by the paper had to do with the choice they had to make between paying some of the outstanding salaries or honouring the statutory obligations such as taxes and pension contributions at the expense of salaries whenever they got some money, especially as the cash flow for most of the businesses were highly constrained and not able to meet both expenditure obligations.

Dr Ayisa however contended that, SSNIT exists primarily to collect contributions from employers on behalf of workers and pay benefits as and when they fall due, and that, they were not ready to renege on their responsibilities.

He disclosed that, as at the end of April 2016, there were 19,569 pensioners within the Takoradi area out of the total of 161.054 nationwide. These pensioners, he said are paid from the returns on the investments that SSNIT makes and also from workers’ contributions.

Currently, he said, employers have multiple channels for submission of contributions reports and billing, regular feedback mechanisms to improve processing time and multiple payments points, which he said marked a departure from what pertained about a year ago.

He assured the public that, work processes in all core and non-core areas of SSNIT’s operations have been automated, enabling the optimisation of financial business processes and ICT environment for prompt and accurate payment of benefits.