1 Statutory Pension Rights and Obligations
1.1 What are the main sources of law governing workplace pension provision
The primary legislation is the National Pensions Act, 2008 (Act 766), as amended by the National Pensions(Amendment) Act, 2014 (Act 883). These statutes establish Ghana’s three-tier pension structure and set out obligations for employers and scheme managers.
Additional regulations include:
- Occupational and Personal Pension Schemes (General) Regulations, 2011 (L.I. 1990) – governing private pension
scheme operations, trustees, fund managers, custodians, and reporting. - Income Tax Act, 2015 (Act 896) – taxation of contributions and benefits.
- Labour Act, 2003 (Act 651) – general employment obligations that affect pension entitlements.
- Administrative Instruments such as National Pensions Regulatory Authority (NPRA) Guidelines, Investment Guidelines, Licensing Guidelines and Scheme Registration Requirements.
1.2 What government or other bodies are responsible for regulating workplace pension arrangements?
The NPRA: licenses trustees, fund managers, and custodians; approves pension schemes; issues investment and operational guidelines; enforces compliance; and supervises the Tier 2 and Tier 3 schemes.
2 State Pension Provision
2.1 Are employers required to contribute to their employees’ state pension entitlement? At what rate?
Yes. Employers must contribute to their employees’ state pension entitlement under the national three-tier pension system. Under Act 766, section 63 provides that the mandatory total contribution is 18.5% of the employee’s basic salary, allocated as follows:
- Employer contribution: 13%.
- Employee contribution: 5.5%
This combined 18.5% is then distributed between the first and second tiers of the pension system. Specifically:
- 5% of the employee’s basic salary is allocated to the Tier Occupational Pension Scheme;3 and
- the remaining portion funds Tier 1 Social Security and
2.2 Broadly, how much is the state pension compared to average earnings
Ghana’s state pension (Tier 1, administered by SSNIT) does not pay a fixed amount relative to national average wages. Instead, it replaces a percentage of the worker’s own average earnings over their best three years (the highest 36 consecutive months of salary). Under the statutory formula in Act 766:4
- A worker who has contributed for 15 years (180 months) receives a pension equal to 37.5% of their best 36-month average salary.
- For each additional year of contributions, the benefit increases by a fixed increment, up to a statutorymaximum of 60% for workers with 35 years or more of
In broad terms, this means the Ghanaian state pension typically replaces between one-third and just over one-half of a worker’s average earnings, depending primarily on the length of their contribution periodcontributions.