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NPRA entreats employers to set up provident fund schemes for employees

Social Employers Scheme
Social Employers Scheme

Mr Hayford Attah Krufi, the Chief Executive Officer of the National Pensions Regulatory Authority (NPRA) has entreated employers to set up provident fund schemes to augment Tier One and Tier Two contributions of employees’ retirement benefits.

”Even if you start with a one per cent contribution, then the worker will top up, because retirement income security is not so much about Tier One and Tier Two, but mostly is about Tier Three”, he said.

Mr Krufi gave the advice at a breakfast meeting organised by the Sunyani Zonal Office of the NPRA on the theme ”Making Pensions Accessible to All” and participated by close to 70 participants that included human resource managers, trade unionists, trustees of pension schemes’, informal sector workers and the media in Sunyani.

A provident fund is an investment fund that is voluntarily established by employers and employees to serve as long term savings to support employees’ retirement.

Mr Krufi explained “Tier One and Tier Two contributions offer 18.5 per cent of contributions, while Tier Three gives an additional 16.5 per cent or whatever percentage the worker can contribute to Tier Three”.

He said provision had been made under section 112, sub-section Two of the National Pensions Act 2008, Act 766 which stipulated that if a worker contributed up to 35 per cent to a pension payment, his/her income must not be taxed.
Mr. Krufi said NPRA was making efforts to ensure employees who decided to contribute to the Tier Three would have tax-free income.

Mr William Ohene-Adjei, the Sunyani Zonal Head of NPRA told participants he would continue to engage and educate workers to be well-informed about issues of their retirement.

He therefore asked workers to visit the office anytime to inquire about issues affecting their retirement.

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