The Problem of the Cap 30 Pension Scheme in Ghana

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Date
2011
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Abstract
This dissertation is about the CAP 30 Pension Scheme in Ghana. The objective is to discuss the main problems and attempt to identify some of its weaknesses and to make suggestions to overcome these weaknesses. It also aims at identifying additional provisions that could be introduced into the current CAP 30 Pension scheme to serve as incentives for members of the scheme. The methodology employed by the researcher for the study included the administration of questionnaires to 20 pensioners and 10 officers of Controller and Accountant General’s Department. The following is a summary of the main findings in the review of the scheme. Currently the CAP 30 pension scheme is funded by direct budgetary allocations from the consolidated fund. However, public servants who qualify for CAP 30 still contributes the 5% of their monthly salary (deductible at source) while the government (employer pays 12.5% of their employees’ respective salaries to SSNIT. Beneficiaries mostly take 6 to 18 months before they are paid. Meanwhile, names are also removed from the payroll one month after retirement. Benefits provided by the scheme are old age pension, invalidity pension and Death/survivors’ lump sum benefit. The study further noted that the basis of computation of benefits was a contributing factor to the inadequacy of pension payments under the scheme. It is also envisaged that the inclusion of workers in all sectors in the pension scheme will enable them to save towards their retirement or old age. This will improve their living standards and guarantee income security in their old age. It will also reduce anxiety, self-exclusion, dependency, and other hardships associated with unplanned retirement.
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A Thesis submitted to the Institute of Distance Learning, Kwame Nkrumah University of Science and Technology in partial fulfillment of the requirements for the degree of Commonwealth Executive Masters in Business Administration,
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