SSNIT To Offload More Stake In Companies

The Social Security and National Insurance Trust (SSNIT) has indicated its intention to intensify its investment re-organisation process. The move, the Trust explained, forms part of its quest to ensure sustainability of the fund. The action of the Trust comes at a time when the decision of the Trust to sell off its stake in some non-performing investments has come under severe fire. But in an interview with the Director of Public Affairs at SSNIT, Mrs Eva Amegashie told the Graphic Business that “we cannot continue recapitalising companies in which we have majority stake when they are not doing well to return what we expect to sustain the pension scheme we run.” The Trust, in offloading its stake in the ailing Merchant Bank to Fortiz Private Equity Fund Limited (Fortiz PE), has come under intense criticism because of what some perceive to be an attempt by SSNIT to short-change contributors on the pension scheme in favour of some ‘powerful men’ in government and cronies of the ruling National Democratic Congress (NDC). Although the new owners of the bank have named their executive team including a new Managing Director to turn the fortunes of the bank around, the challenge against the sale has taken another dimension with the legislature intending to probe the deal. Mrs Amegashie said the Trust was always on the lookout to ensure that companies in which it has interest were performing profitably and “like I said, we have decided not to recapitalise when we see the investment going bad.” She said SSNIT was the pensioner’s funds manager and not an expert in banking or housing and therefore, it would want to own a stake in those sectors but not own them to run them. Presently, the Trust has no majority investments in any bank in the country, having offloaded its stake in Social Security Bank now Societe general, The Trust Bank now taken over by Ecobank and recently Merchant Bank. In the housing sector, the Trust has sold out its flats in many parts of the country but it is now in partnership with real estate companies to undertake a number of projects. “We will do joint ventures and mergers but we do not intend to acquire as we did before”, she said. Meanwhile, SSNIT, in a release to announce the new minimum pensions to be paid to pensioners, explained that the refocus of the Trust, as far as its investments was concerned, was to “enable the Trust exit from non-performing investments and also now, use portion of its investment to benefit contributors.” “We shall continue to count on the support of all stakeholders of the Trust to manage the fund in the supreme interest of all contributors,” it added. Impact of the Tussle Meanwhile the brouhaha on the deal is said to be seriously affecting the fortunes of the bank of which pension contributors have a stake. Many experts have argued that the more the issues arise publicly about the deal, the more the bank’s image will suffer. The Graphic Business has information to the effect that more and more customers of the bank are closing their accounts at the bank because of the cloud of uncertainty around the sale to Fortiz. But in spite of the issues, some workers of the bank are optimistic about the future of the bank. They, in separate interactions with the Graphic Business, said once the case on the sale was closed, the bank, under its new management, would restore the bank to its former glory. New minimum pension Meanwhile the new monthly minimum pension paid to pensioners on the SSNIT scheme has seen a 100 per cent increase (for 2014). Subsequently, the new minimum has been doubled from GH¢100.00 to GH¢200.00. The new figure is also by far higher than the national monthly minimum wage of GH¢141.48. The Trust explained that the new increase “implies that no SSNIT pensioner will receive a monthly pension amount less than GH¢200.00 in 2014. This is applicable to both old and new pensioners.” “All pensions shall be raised by an overall indexation rate of 20 per cent,” it said. According to the Trust, “this shall be implemented as follows: All pensions shall be increased by 10 per cent, plus an additional flat amount of GH¢9.62.” The release noted that Social Security Pension Indexation, however, thrived on prudent investment and uninterrupted receipt of workers' contributions, adding that “this explains why the Trust continuously revaluates its investment strategy.” This, the release said, also means adopting all legal methods to collect all contributions and arrears. It recalled that with the introduction of the National Pensions Act 2008, Act 766, the contribution period for a contributor to qualify for a benefit has been reduced from 20 to 15 years. “This means contributors will qualify for benefits over a shorter period. Benefit payment has also been extended to 75 years”, it added. It urged all contributors to help make the SSNIT Pension Scheme better in the years to come.