The Civil and Local Government Staff Association, Ghana (CLOGSAG) on Tuesday unveiled a housing scheme that will help members get funds to start or finish buildings.
The ‘Pempamsie’ Housing Scheme, in collaboration with the Hedge Pensions Trust, offers members a minimum mortgage of ₡50,000 to carry out construction projects in stages.
The scheme is intended to reduce the housing burden on workers in active service or after retirement.
Speaking at the launch, Mr Ignatius Baffour-Awuah, Minister for Employment and Labor Relations, explained that the Scheme was the outcome of discussions during interactions between the government and labour unions for the Domestic Debt Exchange Programme (DDEP).
According to him, since investment alternatives for pension funds are now “flexible,” their managers should develop programmes that would be beneficial to their contributors.
He commended CLOGSAG and Hedge Pensions Trust for taking the initiative and said that workers requested more pay because they spend around one-third of their income on rent and housing.
Mr Baffour-Awuah believed the Scheme would accomplish this goal by giving civil servants “a reliable place of their own” and, in certain ways, easing employee expectations of the government.
The Minister praised GCB Bank for being a part of the Scheme and asked the leadership of CLOGSAG to carefully roll out the plan so it did not adversely affect the financial standing of members.
“One of the beautiful things we have is that pension funds put together is well over 40 billion cedis as we speak, so if every pension fund is doing a little of what Hedge Pensions Trust is doing today, you can tell the number of housing schemes we will be bringing on board on annual basis,” he stated.
Mr Baffour-Awuah urged potential beneficiaries to consider all factors and not “rush” the well-packaged Scheme.
The Executive Secretary of CLOGSAG Dr Isaac Bampoe Addo, lauded Hedge Pensions for taking steps to actualise the provisions under sections 103 and 114 of the National Pensions Act, 2008, (Act 766).
He said, “Acquisition of primary residence is not an event but a process. There could be a situation where a contributor may need assistance to complete his or her primary residence. Or there could be a situation where the person needs to acquire a plot of land to build a primary residence. Again, there could be a situation where a member could use his or her benefits to secure a mortgage or purchase a primary residence. It is within this context that loans will be provided under the Pempamsie Housing Scheme.”
He stated that the National Pensions Regulatory Authority (NPRA) had approved the Scheme and that beneficiaries were required to make contributions to the CLOGSAG Fund and the Tier 2 Hedge Master Trust Occupational Pension Scheme.
The President of CLOGSAG Mr Benjamin Otto, described the initiative as “good news” to all contributors of the ‘Pempamsie’ Tier 3 Pension Fund as it would offer beneficiaries the opportunity to begin the process of owning a primary residence of their own.
“A roof over the head of a worker is of primary importance, especially when it is to be achieved through the benefit of the third tier of the pension scheme,” he said.
Mr Kojo Nkwantabisa, Head of Custody, GCB Bank, also praised CLOGSAG for the initiative and expressed the Bank’s commitment to working with partners to realise the objectives of the Scheme.
Dzifa Hukporti, ISD