Unionist urges thorough research before diversifying pension investments

By Kingsley Webora TANKEH

The immediate past General-Secretary of ITUC-Africa and former Secretary-General of Trade Union Congress (TUC) Ghana, Kwesi Adu-Amankwah, has called for thorough actuarial studies to decipher the risk involved before making any move to invest ‘hard-earned’ pension contributions into new and riskier ventures like banking, development projects or real estate.

Speaking at a lecture to mark the 80th anniversary of TUC Ghana, the renowned unionist and labour expert warned against any hasty diversification of the country’s pension funds, emphasising that the future security of workers must not be gambled with.

His comments come amid a broader yet contentious national conversation on pension governance and the strong push by eminent individuals and some entities, including the Civil Engineering Council (CEC), hoping to tap into the pension fund pool for development projects.

“The CEC would like to tap into pension funds for investing in, say, banking; but that has been a challenge for them. Well, I think there has to be a close study – because as for funds for the future, you can’t joke with them. You can’t joke with them, so you need to be careful,” Prof. Amankwah warned.

Mr. Adu-Amankwah grounded his caution in the fundamental nature of pension funds – the only source of livelihood after years of service – stressing that they are not government money but belong to the workers.

“They are deductions from our salaries, our contributions. So, in fact, they are rightly speaking workers’ money,” he emphasised, pointing to a history of governance problems within the pension sector and recalling struggles of the early 2000s as an example of risks involved.

While acknowledging government’s legitimate interest and regulatory role in ensuring pension funds are safe and accessible at the time of need, he argued that stronger oversight and transparency should be prioritised to stem any governance issues – not venturing into new investment classes without conducting due diligence.

“The way things get done, sometimes it’s as if pension funds are government funds – which is not the case. Clearer oversight and more interest can make sure the money and resources are kept better,” he added.

Mr. Adu-Amankwah also lent his voice in the debate on what changes can be made to the current labour law, which is being considered for amendment by year-end. He asked that the “employer’s right to terminate without reason” be expunged from the law. According to him, this has been the major problem with current legislation.

“Terminating somebody’s employment should not be done in one second. There should be clear reasons because we are dealing with human life. It’s also your livelihood,” he stressed.

However, he expressed cautious optimism on the push for a national living wage. The  Professor stated that “it is possible”, but contingent on greater unity among workers to effectively negotiate for a more equitable distribution of the country’s resources.

TUC Ghana was formed in 1945 at a railway station in Sekondi, Western Region. It serves as the umbrella-body for over 150 registered trade unions in Ghana, with 6,030 members across the country’s length and breadth.

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