Ghana’s cocoa farmers pension scheme is said to commence operations by October 2021 with the onboarding of some 1.5 million farmers.
The National Pensions Regulatory Authority (NPRA) says it has been working at the modalities for operationalising the scheme with Ghana Cocoa Board and other stakeholders.
President of Ghana, Nana Akufo-Addo, launched the pension scheme for cocoa farmers last December, 36years after the promulgation of a law to that effect.
But six months on the programme is yet to be operational as cocoa farmers remain highly expectant.
Speaking to Accra-based TV3, the chief executive officer of the NPRA, Hayford Atta Krufi, said contributions shall commence soon as processes are streamlined.
The collection of contributions he explained will be taken at the point of sale where farmers sell their cocoa beans to the licensed buying companies (LBCs).
Five percent (5%) of the value of the beans sold will be deducted electronically and credited to the account of the farmer.
“Administrators of the scheme have a digital arrangement whereby anytime you sell [a minimum] 20kg of cocoa, 5% will be deducted and put into your account. Every cocoa farmer will have an account. The account is divided into two – a savings account and the retirement account”, Mr Krufi said.
He disclosed that the authority is in discussion with COCOBOD, the sole off-taker of cocoa farmers’ produce, to add a counterpart contribution of one percent (1%) for every 5% contributed by the farmer.
The 75% of the contributions, the NPRA boss explained, will be locked into an investment fund out of which the cocoa farmer can access monthly incomes when they hit the statutory retirement age of 60 years.
According to Mr Krufi, the remaining 25% will constitute a savings account or provident fund for the cocoa farmer, accessible after 2 years.
“But there is a 25% which is savings so that when you fall on hard times, for example, you need money for your child’s education or some other expenses, you can draw on it. It’s not seen as if people are locking their money away over a long period of time”, Mr Hayford Atta Krufi observed.
The Cocoa Farmers Pension Scheme was established last year in fulfilment of Section 26 of the Ghana Cocoa Board Law, 1984 (PNDCL 81).
It is to serve the purpose of guaranteeing a decent retirement income for cocoa farmers for life and ensure that they are able to maintain decent livelihoods after retirement.