The Ghanaian government has provided a 15% Cost of Living Allowance (COLA) to all public sector workers in order to cushion them from the current socio-economic realities and global events that will influence the lives of ordinary Ghanaian workers in 2022.
The late President John Evans Atta Mills instituted the payment of Cost of Living Allowances (COLA).
COLA, like the bulk of allowances, has no effect on SSNIT. It acts as a barrier between employees and the harsh consequences of economic downturn.
Base wage was increased by 10% in 2013. Following lengthy negotiations, the government decided to pay public sector employees with a cost-of-living stipend equal to 10% of their base monthly wage in 2014. (COLA).
As a result, the purpose of this article is to disclose the techniques utilized in determining the government’s 15 percent COLA.
The Cost of Living Allowance (COLA) for 2014 was paid as a result of an increase in the Base Pay on the Single Spine Salary. Clearly, there was no raise in the minimum wage in 2014. In 2015, basic government pay increased by 13%.
Because base pay did not increase in 2014, the 13% increase in 2015 was merely an increase above the basic income in 2013.
Given the 7% base pay increase in 2022 and the 15% COLA (from July 2022 to December 2022), which will result in a % increase in gross compensation, a realistic salary analysis would suggest that the TUC should settle on base pay increases ranging from 17 to 25% for 2023.
Any proportion of base pay less than 18% results in a gross income for 2023 that is much lower than the wage for July-December 2022. A COLA is not a salary increase. It’s just an extra allowance with a deadline, and if the allowances end, your base wage will continue to stare at you silently.
The COLA amount is identical to our retention premium, and this was the only payment available to teachers in the past. The Retention Premium is likewise 15% of the starting wage. Furthermore, the single spine base pay will be determined using 15% of the single spine monthly income.
For example, suppose the monthly salary for a single spine on the payslip is GHC 1954.90. 15/100 = 1954.90 = GHC 293.24 This is the same amount as your retention premium.
It should be noted that the GHC 293.24 will be paid every month from July to December, with no SSNIT deductions. In short, the 15% COLA is not taxable.
How to Determine COLA On Payslip
The retention premium amount listed on your pay slip corresponds to the amount of the COLA you will get.
Earners withing this range should check out the calculation of COLA below:
COLA Amount on Basic Salaries in Ghana
|SALARY (GHS)||COLA (GHS)||TOTAL (GHS)|