The Federal and state governments are insensitive to the plight of pensioners, the Director, Centre for Pension Rights Advocacy, Comrad,e Ivor Takor, has said.
Takor, a member of the pioneer National Pension Commission (PenCom) Board, said challenges, which include low coverage and lack of political will, especially by state governments, were affecting the scheme despite the achievements in the sector.
He noted that only 24 states had enacted laws on the CPS, and of these, only four had fully implemented the scheme. He urged the federal and state governments to comply with the Pension Reform Act 2014.
He said there was also the need for enhanced service delivery by pension operators and increased awareness. Harnessing the gains of the CPS to the country’s development, Takor stated that the scheme has accumulated long-term investable funds of over N13 trillion, which is being invested to boost development.
He said: “In most developing countries such as Nigeria, the rates of productive capital formation through savings are low because of poverty and low income. Workers are so poor as to be often near subsistence. They, therefore, cannot save, even if they will like to do so. Other factors include lack of ethics, stressing frugality; prevailing rules of the game that give people little incentive or reward for saving and emulation of consumption standards of advanced nations.
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“One important condition for promoting development is better utilisation of labour. Nigeria has a large part of her labour force that does almost nothing (unemployed). There are others who may not be called employed. They can either be termed disguised unemployed or underemployed. These are persons doing jobs far below their academic and professional qualifications. Economic growth of a country can be referred to as economic capacity to increase the productivity of services and goods in comparison with previous time period.
“The success of every government is tied to the growth of the economy of the nation.Therefore, achieving a high and stable economic growth rate is an important issue for every government, since growth is a key to citizens’ enjoyment of a higher standard of living. The CPS, being a mandatory scheme, has compelled employees and employers in the public and private sectors to save a minimum of 18 per cent into employees’ RSA, from where they (employees) will be paid retirement benefits. This has increased national savings pensions fund liabilities have a long maturity period, consequently, they are open to long term investment through long term equity stakes.”
Takor added that the fund had come as an independent financial intermediary, as the nation’s private business enterprises no longer rely on banks as the sole sources of outside capital for the financing of their businesses.
The pension advocate maintained that investment of pension funds in federal and state governments’ securities has assisted the governments to manage their national debts, thereby contributing to solving of their financial needs and the stability in the market of government debts.
This is why the federal and state governments should key into the scheme by comply with the Pension Reform Act 2014, he said.