Category: Pension

Heirs Life Assurance (HLA), one of Nigeria’s leading digital life insurance company, is celebrating Valentine season with a product for couples.

The company is set to thrill customers with the product named Heirs Couples Plan, to drive financial inclusion.

According to the Chief Marketing Officer, Heirs Life, Ifesinachi Okpagu, in a statement, the Heirs Couples Plan would start off with a Valentine contest for couples. It is being powered by Heirs Life in partnership with Aura by Transcorp, the digital booking platform for accommodation.

Winners would get a free one-night stay at a hotel, breakfast, and spa treatment for two.

She stated the company believes that financially strong individuals and families are the bedrock of every nation. Okpagu said: “Heirs Couples plan addresses both units, and we hope that the future will become much brighter and less fraught with uncertainties with this plan. It seeks to promote financial strength amongst couples by encouraging couples to save together and earn competitive interests. It is open to married and unmarried individuals. If there is a split, the saved funds and interest will be split according to pre-agreed terms stated by the couple at the onset of the plan.  It is also bundled with a life assurance element that provides an amount in the case of death.

“The product is the latest of many others that have been introduced by Heirs Life to make insurance accessible to everyone. Heirs Life continues to transform the life insurance space in Nigeria through its digital service delivery and provision of simple, quick, reliable, and accessible financial security plans to individuals and businesses. The company is a subsidiary of Heirs Holdings, a pan-African investment group with presence across 23 countries worldwide.

“Alongside other products, the Heirs Couples plan can be purchased via the company’s website and other digital channels or through the company’s accredited representatives.’’

SOME pensioners are agitating for the payment of either 75 or 100 per cent of the benefit in their pension account.

They argue that it is their entitlement and should be given to them in full.

According to them, they have worked for 30 to 35 years and thus  could manage their investments.

A pensioner Uwaifor Oga wrote on the Facebook, “Allow pensioners withdraw all their savings If they wish. pension fund administrators are exploiting us”.

He said: “The pension manipulations should be stopped by Nigerians. I was very happy when the Senate recently made a move to amend the Pension Act to enable Nigerians withdraw up to 75 per cent of their cumulative savings. The liberty should even extend to allowing pensioners withdraw their whole sum if he or she so wish. The law could also give pensioners the liberty to either withdraw their total sum or give the PFAs the kind of investments they want with their hard-earned funds.

“After hitting 65 or spent 35 years in active service to your nation, gathering experiences in finance, administration, among others, PFAs still refer to you as a novice; you don’t know how to handle your hard-earned entitlements!

A retiree, Joshua Arinze, said: “I need my money. I can do better business than the pension managers.”

Another said: “I want to cash out my pension. But no. Money in your pension account is not your money.

“On a lighter note, eight per cent of the money can be said to be your money. The other 10 per cent belongs to your employer, whether in the private or public sector.”

According to the Pension Reform Act (PRA) 2014, the minimum rate of contributions under the Contributory Pension Scheme (CPS) is 18 per cent of the employee’s monthly emoluments where 10 per cent is contributed by the employer and eight per cent is contributed by the employee.

In some cases, some employers make the contribution of 18 per cent for their employees without making any deductions from their salaries.

A pension expert, Sola Subomi, said the argument lacked merit, querying if the pensioners agitating for a 100 per cent pension pay-out know how the country’s pension system fared before 2004, with over N2trillion in pension deficit.

He said: “If all of them are knowledgeable in investment, why do we have investment managers? The Federal Government under former President Olusegun Obasanjo spent thousands of man hours to get the best for the nation to put the pension mess behind us. Nations were under studied and visited.

The person should go and read the pension act and see the pains taken to make it work and safety measures.’’

Another expert said: “Unfortunately for the agitators of 100 per cent pension payout, it is beyond their choice not to subscribe to CPS because it is compulsory. And this is so because government does not want them to become a destitute cum liability.

“If pensioner is claiming that he or she is a financial expert, then they wouldn’t need to agitate for pension money because they should have huge savings from salaries earned during the period they were in active service. I bet many of them don’t have any savings. Otherwise, he or she won’t be looking the way of pension.

“The agitators need to be educated and legislators seeking 75 or 100 per cent pension that it is not in entirety their money. Government contributed a portion as its own social security scheme and made private employers to do same”, he noted.

Leadway Capital & Trusts Limited has advised Nigerians to plan their estate to ensure that their assets are well distributed.

Speaking at a training organised by Leadway Assurance for reporters in Lagos, an excutive of the company, Gbolahan Oluyemi said estate planning is the preparation and planning to manage an individual’s asset base after their demise or incapacitation.

He stated that there are various modes of estate planning which include trust, inter vivos gifts or wills.

Oluyemi explained that a trust is an arrangement where a person transfers an asset to another person (trustee) to hold for the benefit of a third party (beneficiary), adding that trust is flexible and can be amended to achieve objectives such as education trust, welfare trust, living trust, or even healthcare trust.

He said: “A Will is a legal document by which an adult expresses how he or she wants his or her assets or property to be distributed after his or her death. The procedure of preparing and executing a Will, he said, is regulated by the Wills law of various states, even as the person who writes a Will is called Testator/Testarix.

“To die testate implies that a person died leaving a Will behind and it controls distribution of ones’assets, helps to appoint executors yourself, Will admitted to Probate, as well as you appoint your guardians.

“However, to die intestate implies that a person died without a Will and that, “administration of estates law determines distribution, state appoint administrators, letters of administration, as well as no appointment of guardians.’’

On why it is important to write a Will, he stated: “Ensure that your assets will be distributed according to your wishes, offers protection for your beneficiaries, excuses the need for Letters of Administration, contains an inventory of assets and reduces fraud in the succession process, as well as ease access to the Retirement Savings Account.’’

What is the guarantee that the pension funds under the new scheme will be well managed and not diverted?

The functions of the Pension Fund Administrator (PFA) and Custodian are clearly spelt out in the Pension Reform Act 2004. The Act provides adequate safeguards against the misuse of the pension funds and assets by any operator.

What happens if a PFA fails or is liquidated?

The pension funds and assets in the Retirement Savings Account (RSA) are kept by the PFC and as such, the liquidation of the PFA will not affect the funds and assets. Besides, every PFA is expected under the Pension Reform Act 2004 to maintain a statutory reserve fund as contingency fund to meet claims for […]

Who can I complain to if I have a problem with a PFA?

The Pension Reform Act 2004 allows any employee to complain about any PFA to the National Pension Commission.

What is the role of the government in the new pension scheme?

The Federal Government has established the National Pension Commission and charged it with the  regulation and supervision of the new pension scheme.

Can the government take or use the money in my RSA for any purpose?

The government cannot tamper with the pension funds in your RSA, because it cannot have access to the account. Besides, the government is primarily concerned with ensuring the safety of the fund in your RSA through the enforcement of strict rules and regulations.

Will inflation and devaluation of the Naira not erode the value of the pension contributions?

It is the duty of the PFAs to administer the contributions and invest in such a way that will ensure safe and reasonable returns on investment. The reserve fund created by the PFAs under the Act would compensate for any erosion of the value of the contributions.

How is compulsory or voluntary retirement, especially in the Armed Forces to be handled under the new scheme, if this happens before the  50 years?

Under the Pension Reform Act 2004, a person can voluntarily or be compulsorily retired before 50 years on the ground of medical advice, permanent disability or due to particular terms of employment. If any person retires under any of the foregoing circumstances, he is entitled to withdraw from his […]

What is the minimum of pension guaranteed under the new scheme?

The minimum pension guarantee shall be determined from time to time by the National Pension Commission.

Is there adequate representation of stakeholders on the board of the commission, or is it dominated by government appointees?

There is adequate representation of relevant stakeholders in the Board of the National Pension Commission, which comprises representatives of the government, Nigeria Labour Congress (NLC), the Nigerian Union of Pensioners and the Nigerian Employers Consultative Association.

Does the Pension Reform Act reflect the application of the principles of transparency and accountability?

Yes. The new pension scheme entrenches the principles of transparency and accountability as reflected in the reporting requirement of the PFAs and PFCs to the contributor and the National Pension Commission. An employee has the right to choose who manages his RSA and the right to receive statements of his account on quarterly basis […]

How can I be sure that my contributions are safe?

All those managing or keeping  pension funds and assets will be licensed and continually regulated and supervised by the National Pension Commission

A total of 12,877 Retirement Savings Account (RSA) holders changed to their preferred Pension Fund Administrators (PFAs) during the Third Quarter of the last year, The Nation has learnt.

The transfer, which is approved by the National Pension Commission (PenCom) under its RSA Transfer System (RTS), was concluded in the first week of last October.

The commission created the RTS for aggrieved contributors to switch their PFAs to ensure good customer service among PFAs.

The Director-General (DG), PenCom in a report obtained by the newspaper, said the transfers covered requests submitted by PFAs between last June and August.

She stated that of the RSA Transfers initiated, 12,872 RSAs were transferred to their new PFAs along with their pension assets, while the others were outstanding due to non-upload of the transaction history of their RSAs.

On the RSA membership count by PFA, the PenCom boss said PFAs registered78,115 RSAs under the Contributory Pension Scheme (CPS) during the quarter under review.

She said this brought the cumulative RSA registrations to 9,461,173 by last September.

She further stated that an analysis of the new registrations under  the CPS showed that 85 per cent of them were below 40 years.

This, she said, points to the increasing sustainability of the CPS, as the younger generation are actively being enlisted into the Scheme.

On the gender distribution, she said 65 per cent of those registered during the quarter were male, while 35 per cent were female.

Meanwhile, the pension industry recorded a marginal growth of 0.84 per cent (79,451) in schemes membership during the quarter under review, rising from 9.44 million members at the end of last year’s Second Quarter to 9.51 million as at Third Quarter of the same year.

Mrs. Aisha Dahir-Umar explained that the growth in the industry membership was driven mainly by the RSA Scheme, which had an increase of 77,969 registered contributors.

She said: “Membership of the Closed Pension Fund Administrator (CPFA) Schemes recorded an increase of 1,482 or 9.93per cent, while Approved Existing Schemes (AES) remained unchanged as at Q3 2021.

“The cumulative RSA registrations grew from 9,383,204 recorded in Q2 2021 to 9,461,173 as at the end of Q3 2021, representing a 0.83 per cent growth.This was mainly attributed to an increased level of compliance by the public and private sectors.”

Also, the DG said the scheme grew by N272.15 billion pension contributions during that the period.

“The total pension contributions remitted to individual RSAs in Q3 2021 stood at N272.15 billion.

“Out of this total, the public sector accounted for N170.96 billion or 62.82 per cent, while the private sector contributed N101.19 billion or 37.18 per cent.

“The cumulative pension contributions from inception to the end of the third quarter of 2021 amounted to N7.37 trillion, which is an increase from N7.10 trillion as at the end of Q2 2021,” she added.

ANNONYMOUS: Hello, I retired from the Nigeria Police in 2015.

I recall that President Muhammadu Buhari approved a certain amount for pensioners, including a minimum wage and subsequential adjustment benefit. Some federal establishment have received this money in arrears, including 2.5 per cent’ arrears.

Any time we demanded the fund,  PenCom would reply that it had been paid to our PFAs. Yet, our PFAs deny the remittance. Why has PenCom refused to remit the fund to them when retirees in other federal establishment have collected their entitlements?

PENCOM: Please be advised that the payments approved by the president have since been paid to the pension fund administrators (PFAs). Kindly liaise with your PFA for further assistance. Thank you.

OLATUNJI: Dear Madam, I have some cash in my account with my PFA. My company shut down during the COVID-19 lockdown. Since then, I have not secured any job.

I have approached my PFA that I wanted to collect my contribution to start a business. It said I could only be given 25 per cent of my total contribution.  I pleaded with them that 25 per cent of my account balance could not help me. But they are not listening.

Please I need your help.

PENCOM: Please be advised that due to the balance in your RSA, you are only entitled to withdraw 25 per cent as lump sum while the  balance will be spread as your monthly pension. Kindly liaise with your PFA for further assistance. Thank you.

CHUKWUKADIBIA: Good day, Madam. I am Chukwukadibia. I registered with Premium Pensions Limited as a Constable with my phone, now an Inspector. I later lost the phone with the SIM card.

Worse still, I no longer have access to it and have not been receiving alerts on my RSA from Premium for years.

Kindly help me.

PENCOM: The complainant is advised to visit Premium Pensions Limited for update on your details and request for alerts.

COMRADE WAHAB: My name is Wahab. l am a retired from the Nigeria Railway Corporation (NRC) in 2014. Before the commencement of my retirement, l am supposed to go for pre-retirement empowerment by the management with the financial benefits. As at now, this has not happened for me. Please help me to investigate. My colleagues have already gone for the pre-retirement empowerment and they have received financial benefits attached to it. I don’t know why my own case is different, please help me to investigate. Again, I heard that our president, Muhammadu Buhari,has released money to pay pensioners pensions, gratuities and other outstanding. But my pension funds administrator, Premium Pension did not send any information to me.

PTAD: Please forward your name as well as your RSA PIN details to enable the commission investigate further. Thank you.

ABDULLAHI: Good day, my name is Abdullahi, the son of the late Inspector Etubi. You earlier informed me that everything had been settled. We were asked to provide our father’s name and RSA PIN to enable the commission to investigate further. We have done that. We learnt from The Nation that we were among the next batch to be paid. But we are yet to be paid.

Kindly help.

PENCOM: Investigation has shown that you have not submitted such details to our database.

Kindly visit your PFA to ensure that your documents are further submitted to the Commission.

OKOH: Good day, Omobola, I really want to appreciate your efforts in helping senior citizens to resolve their nagging post-service issues through your pages in The Nation. It is as gratifying as it’s salutary. May bless the newspaper.

The platform has gone a long way to bring the pension reform to the fore for pensioners. However, I will like to plead, though not within the purview of the platform, but related to pensioners’ handicap, the National Housing Fund (NHF), to which workers make contributions.

It was expected that at retirement, the retiree gets his contributions refunded. It’s unfortunate that after a year or two of retirement, neither the Federal Mortgage Bank or the National Housing Fund is saying or doing anything to make refund of accumulated and earned contributions. We would appreciate it, therefore, if your platform would extend the gesture to this issue. We really appreciate your good works as a national service to humanity.

PENCOM: Please be advised that the above complaint is not within the purview of the National Pension Commission. Please re-direct the complaint to the necessary authority. Thank you.

To further drive awareness on retirement issues, Inspenonline Limited has initiated a YouTube programme to educate the public on the benefits of a retirement plan.

Its Managing Director, Chuks Udo Okonta, said the firm unfolded the programme to address the dearth of knowledge on retirement and help the public to understand and maximise the opportunities to prepare for life after active service.

He said his decision was informed after he engaged in research to ascertain the quality of content on retirement and observed a huge dearth of local content available to help the public put in place a retirement plan.

He explained that the programme, which runs from Monday to Friday, provides news, interviews and discussions while addressing concerns raised by the viewing public.

He said: “Information is the life-wire of business and vital to human development. Therefore, we are poised to exchange necessary information with all stakeholders in the retirement space. As blissful retirement remains the desire of all, the Retirement Matters programme was conceived to provide and promote knowledge required to achieve the quest for a better future after a resourceful active life.

“Our programme hinges on interviews, feedback, analysis, reportage and more. Through these avenues, we will derive information and disseminate them to the end-users. The interview section will create opportunities for the regulator and operators to address issues and give updates on events in the sector. It will also create an opportunity for the end-users of retirement products and services to express themselves and make contributions on how the regulator and operators can improve their performances.”

To address the challenges of Contributory Pension Scheme (CPS), the National Pension Commission (PenCom), Pension Fund Administrators (PFAS) and other stakeholders in the administration of pension funds should consider the basic needs of contributors, the immediate past Director-General, Lagos State Pension Commission (LASPEC), Mrs. Folashade Onanuga, has said.

Mrs. Onanuga described the basic needs, which must be considered  with inflation so that consumers could get the benefits that the scheme was created for.

She stated that because of the economic pressures, a lot of people are more open to the possibility of withdrawing their pensions savings. Is there a way to accommodate this request, she asked?

If, for instance, employees with Retirement Savings Account (RSA) balances of less than a certain amount are allowed to withdraw their pension savings, then what is the rationale for locking others in? she asked.

She said: “Can we include penalties for early withdrawals?  Can incentives like basic levels of healthcare be offered as incentives to encourage clients to remain with their pension provider after they retire? Are there opportunities to offer clients more within the ambit of the law?

“Such flexible options will give clients of pension funds more control over their future while also catering to the profit motive of operators. When pensions products are demanded by the average Nigerian worker either in the formal or informal sector and not impressed on them, a major milestone in financial inclusion would have been achieved.”

Commending PenCom, she said a tremendous amount of progress had been made in the last 17 years in the industry with regulation as an enabler for the growth.

She, however, said inclusive growth in pensions must recognise the peculiarity of the population segment being addressed.

“This recognition must have an impact on how products are designed and how lower income segments of the population interact with pension funds. If you consider what happens in developed economies, there are different kinds of plans to meet different needs.

“There is also a trust gap to be bridged in the pensions industry despite the potential benefits of the product. PenCom as the regulator needs to take more advantage of digitisation in pension operations to make transactions easier and more accessible.

“In this, we can take a page out of what the banks have done to provide banking services to lower-income population groups.  Structures must be in place before the release of pension laws to ensure that all aspects of the Law are implementable,” she said.

She pointed out that the CPS was designed to address the problem of inadequate or no preparation for retirement.

The scheme, according to her, has done more good as it has allowed incredible mobility for employees in the formal sector, simplified the administrative processes and reduced drastically the fraudulent practices in pension scheme administration.

But, she noted, that the scheme is yet to fully address the issue of ensuring that retirement benefits are paid as at when due,  especially where benefits accrue to workers under the defined benefit plan.

“Pension benefits as received by many in the CPS dispensation, have been considered very inadequate to give comfort in old age. While we would like greater participation from state governments and small/medium sized corporates, that is not something we can boast.

“Today, pension funds under management are over N13 trillion with enrolment less than 10million registered contributors. With the inclusion of the informal sector under the micro pension plan, this can be much higher. However, we must understand the needs of the population group we want to serve. We cannot use conventional products with this market segment. In addressing these needs and concerns, we will be doing our part to creating lasting economic change in Nigeria.

“Consequently, the opportunities which exists for increased financial inclusion in both the insurance and pension sectors will only be achieved if we design products that are perceived to meet the people’s needs and could be seen as improving their welfare rather than impoverishing them. Operators must be engaged in strategic thinking; have a broad understanding of the economic situation of the country, understand the mindset and ways of life of different ethnic groups and then have a variety of products from which the people can make a choice from,” Mrs Onanuga added.