Don’t Cancel the Pension Scheme for Cocoa Farmers

Introduction

Ghana’s cocoa farmers have been the backbone of the nation’s economy for generations, financing schools, roads, hospitals, and foreign reserves. Yet, for decades, their contributions were met with little more than goodwill and gratitude, especially in retirement. In 2020, the Cocoa Farmers Pension Scheme (CFPS) was introduced—a transformative welfare intervention that finally recognized these farmers as citizens deserving structured dignity. This article explores why cancelling this scheme would be a grave policy reversal and how it represents a shift from commodity obsession to human-centered governance.

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Key Points

Background

For decades, Ghana’s cocoa policy focused primarily on production volumes, export earnings, and foreign exchange receipts. The beans were the center of attention, while the farmers who produced them were often overlooked. This changed under the Akufo-Addo and Bawumia administration, which deliberately shifted the focus from cocoa as a commodity to cocoa farmers as citizens deserving dignity and protection.

The Cocoa Farmers Pension Scheme symbolizes this philosophical shift. It is not just about beans; it’s about people. The scheme was designed to provide formal retirement protection to farmers who are already part of a regulated system under COCOBOD. With the introduction of the Cocoa Management System (CMS), farmers are now digitally registered and integrated into a traceable national production system, making them formal participants in the cocoa value chain.

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Analysis

From Informal Labour to Formal Protection

Cocoa farmers in Ghana cannot sell their produce to just anyone—they are bound by law to sell through COCOBOD. This makes them part of a formal system, yet they have historically been denied formal retirement protection. The CFPS corrects this injustice by providing a contributory pension scheme, where farmers contribute 5% of their earnings, deducted at source, to secure their retirement.

The Fairness Question

The FOB (Free on Board) price of cocoa is shared 70% to farmers and 30% to service providers, including COCOBOD. While workers paid from the 30% enjoy contributory pensions, farmers who produce the wealth have traditionally been left out. The CFPS addresses this imbalance, ensuring that farmers receive the same retirement benefits as other formal workers in Ghana.

A 36-Year Legal Obligation Finally Honored

Section 26 of the Ghana Cocoa Board Law (1984) required the establishment of a contributory pension scheme for cocoa farmers. For 36 years, this legal obligation was ignored. The NPP government under Nana Akufo-Addo and Bawumia activated the scheme in December 2020, enrolling over 100,000 farmers. This was not a campaign promise but institutional reform backed by farmer participation.

The Fiscal Argument Does Not Hold

When the scheme was introduced, cocoa prices were around USD 2,000 per tonne, and COCOBOD carried significant debt. Yet, the government proceeded because farmer welfare mattered. Today, international cocoa prices are even higher, making the scheme more sustainable than ever. Cancelling it now would be a step backward in social justice.

Infrastructure Already Built, Now Idling

The CFPS was piloted successfully in three cocoa districts and established six operational offices across the country. A Board of Trustees was constituted, and a Scheme Administrator was appointed. Systems were made functional, and the scheme was ready for nationwide rollout. However, implementation has stalled, and farmers who enrolled are now requesting refunds. This is not just policy drift—it is an erosion of trust.

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Practical Advice

For Policymakers

– **Continue the Scheme:** The CFPS is a lawful, regulated, and financially sustainable intervention. Cancelling it would undermine social justice and erode trust among cocoa farmers.
– **Strengthen Implementation:** Address the current stagnation by reactivating the operational offices and ensuring that enrolled farmers receive their benefits.
– **Communicate Transparently:** Engage with farmers and stakeholders to rebuild confidence in the scheme and demonstrate a commitment to their welfare.

For Farmers

– **Stay Informed:** Understand your rights under the CFPS and the benefits it offers.
– **Engage with Authorities:** Voice your concerns and demand accountability from policymakers to ensure the scheme’s continuation.

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FAQ

Conclusion

The Cocoa Farmers Pension Scheme is more than just a policy—it is a moral and legal obligation to Ghana’s cocoa farmers. It represents a shift from commodity obsession to human-centered governance, ensuring that those who have contributed so much to the nation’s development are not left behind in their old age. Cancelling the scheme would be a grave policy reversal, eroding trust and undermining social justice. Policymakers must demonstrate maturity by continuing and strengthening this transformative intervention. Ghana’s cocoa farmers are watching, and history will judge whether their welfare is truly a priority.

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Sources

– Ghana Cocoa Board Law (PNDC L.81), 1984
– National Pensions Regulatory Authority (NPRA)
– Cocoa Management System (CMS) data
– Statements from Hon. Joseph Cudjoe, former Investment Manager, Ghana Cocoa Board, and former Minister for Public Enterprises

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