The Nation Newspaper

Category: Pension

  • Pension fund ‘rose by N140b in September’

    Pension fund assets under the Contributory Pension Scheme (CPS) have continued to be one of the fastest growing savings accounts in the country as it grew by N140 billion in September.

    This is according to a table on pension monthly summary for September, released by the National Pension Commission (PenCom) this month, a copy of which was obtained by The Nation.

    The fund’s growth is majorly from a pool of monies in Retirement Savings Account (RSA), Retiree Fund and Return on Investment.

    Total fund assets as at the period under review increased to N9.58 trillion from N9.44 trillion recorded at the end of August, 2019.

    The N140 billion increment was achieved in September, representing 1.48 percentage growth in the period of one month.

    The pension industry regulator stated that the Pension Fund Administrators (PFAs) as usual invested 71 per cent of the total pension fund in Federal Government Securities, amounting to N6.8 trillion.

    Further breakdown showed that the pension managers invested N621 billion in Corporate Debt Securities, representing 6.4 per cent; Local Money Market N916 billion representing 11.2 per cent; and Mutual Funds N10 billion representing 0.2 per cent.

    Under Federal Government Securities, FGN Bonds got N4.4 trillion; Treasury Bills N2.2 trillion; Agency Bonds (NMRC & FMBN) N10 billion; Sukuk N80 billion; Green bonds N13 billion and State Government Securities N125 billion.

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    A further breakdown showed that N492 billion was invested in Domestic Ordinary Shares, representing 5.1 per cent; while N65 billion was invested in foreign ordinary shares representing 0.68 per cent.

    Under Corporate Debt Securities, Corporate bonds got N572 billion (5.97 per cent); Corporate Infrastructure bonds N17.79 billion, (0.19 per cent); Corporate Green Bonds, N31 billion, (0.33 per cent); Supra-National Bonds got N4 billion (0.04 per cent); Commercial Papers, N123 billion (1.29 per cent); and Banks, N951 (9.93 per cent).

    Under Mutual Funds – investments in Open/Close-End Funds was N9 billion representing 0.10 per cent); Reits was N11 billion representing 0.12 per cent; Real Estate Properties, N231 billion (2.42 per cent); Private Equity Fund, N32 billion (0.33 per cent), Infrastructure Funds, N34 billion (0.36 per cent); and Cash & Other Assets, N26 billion, (0.28 per cent).

    The commission noted that in line with the Multi-Fund Structure, Retirement Saving Account (RSA) Fund 1, N19.3 billion was invested; RSA Fund 11, N4.22 trillion; RSA Fund 111, N2.37 trillion and RSA Fund IV, N768.3 billion.

    PenCom’s Acting Director-General, Aisha Dahir-Umar, attributed the accumulation of N9.58 trillion and other successes achieved since inception of implementation of the CPS to contributors. She called on employers and contributors to continue to contribute positively towards the success of the pension reform.

  • Pension complaints and solutions

    ELETU: Dear Ma, this is the third appeal letter I have written to you without any reply either to me personally or published in The Nation newspaper. And I don’t miss any Wednesday newspaper. Therefore, consider me and help me out before I die. My name is ELETU from Ilorin. I was born on June 10, 1950. I joined Nigeria Customs Service on September 25, 1975. I retired on October 25, 2017. I am on Level 09/Step 10. I was verified on December 6, 2017 at PTAD headquarters Maitama, Abuja. Up till today, I have never received a kobo either pension, gratuity or any retirement benefit, both 33% arrears and other backlog retirement arrears since then. I have travelled to PTAD headquarters more than 100 times. All I was told was wait small,  but till when? I have written appeal letters to President, Vice President and even to the former Executive Secretary of PTAD, Mrs. Sharon Ikeazor. I have sold all my properties I acquired during my working time to treat myself and my aged, sick mother. Even my family is now going about begging. After serving my country for many years, is this how government will pay me back?  Save me and my family from suffering. I am on my sick bed now. Please appeal to PTAD to pay me.

    THE NATION: The Nation will intervene by sending your complaint to PTAD. Do watch out for the newspaper publication next Wednesday for a response from the commission and subsequently every week for pension news.

    MBA: Dear Omobola, my name is Mba, I am a state pensioner with federal share. I retired from service in September 2009, on Grade Level 15, Step 9. I have done my verification and have done that which is expected of me, yet nothing is forth coming. I have not been paid gratuity or pension. Kindly help me to get my little entitlement. From Owerri, Imo State.

    Read Also: Pension complaints and solutions

    THE NATION: The Nation will intervene by sending your complaint to PTAD. Do watch out for the newspaper publication next Wednesday for a response from the commission and subsequently every week for pension news.

    MRS. FLORENCE: I am Mrs. Florence from Akwa Ibom State. I am the pensioner whom you helped get PTAD to pay her pension that was skipped last year. I am still grateful to The Nation newspaper. But my second request is payment of my federal share of gratuity pending since May 2005 when I retired. Please, help me to get them to pay me as you did last year.

    THE NATION: The Nation will intervene by sending your complaint to PTAD. Do watch out for the newspaper publication next Wednesday for a response from the commission and subsequently every week for pension news.

    JOEL: Please will you kindly differentiate or explain the difference among these three pension terms: Lump Sum, Programmed Withdrawal and Annuity? I can’t comprehend how each works. Your assistance on this is highly needed. Thank you so much.

    THE NATION: The Nation will intervene by sending your complaint to PENCOM. Do watch out for the newspaper publication next Wednesday for a response from the commission and subsequently every week for pension news.

  • Impact of pension funds on financial services sector

    Over the last 15 years, the pension sub-sector of the financial services sector has done well by securing a better future for workers. Huge cash has also been saved.  Omobola Tolu-Kusimo writes on the future of the sector in another 15 years time.

     

    Fifteen years ago, Nigeria’s pension administration was in disarray. Fast-forward to now, the sector has become a veritable source of critical growth in the country with N9.4 trillion accumulated pension fund.

    Besides, the pension space has been one bright stopshop for the financial services sector. Also, about nine million pension contributors now have a secured future after retirement.

    Following a pension reform that commenced in 2004, the pension fund rose from over N2 trillion deficit in 2004 to N9.4 trillion as at August this year.

    The reform was necessitated by the many problems bedeviling the public and private sectors’ pension schemes in the country. In the public sector, the Defined Benefits Scheme (DBS) was faced with the problem of huge liabilities arising from lack of adequate and timely budgetary provisions as well as increases in salaries and pensions.

    Pension administration was largely weak, inefficient, less transparent, cumbersome and marred with corrupt practices.

    Many private sector organisations   did not have any pension arrangement for their employees and where it existed, it was characterised by very low compliance ratio due to lack of effective regulation and supervision of the system.

    After a thorough consideration and detailed evaluation of these issues, the Federal Government decided to take measures aimed at developing a system that is sustainable and has the capacity to achieve the ultimate goal of providing a stable, predictable and adequate source of retirement income for employees in both the public and private sectors in the country.

    This led to the enactment of the Pension Reform Act 2004 (PRA 2004), which introduced a mandatory Contributory Pension Scheme (CPS) for employees of the Federal Government, the Federal Capital Territory and the private sector organisations with five or more employees.

    The Act also established for the first time in the country, a regulator and supervisor of pension matters, the National Pension Commission  (PenCom).

    The PRA 2004 was subsequently repealed and replaced in 2014 by the Pension Reform Act 2014 (PRA 2014), which, among other things, enhanced the benefits accruable to the contributor on retirement,  enhanced the protection of pension fund assets and unlock the opportunities for the deployment of pension assets for national development.

    It also reviewed the sanctions regime to reflect current realities, provided for the participation of the informal sector and also expanded the coverage of the CPS to include employees of states and local government areas.

    The scheme introduced by the 2004 pension reform is contributory in nature, fully funded, managed and kept in custody by private operators and is based on individual portable accounts.

    The key objectives of the scheme are to ensure that every person who has worked in either the public or private sector receives his/her retirement benefits as and when due;  assist improvident individuals by ensuring that they save to cater for their livelihood during old age; to establish a uniform set of rules and regulations for the administration and payment of retirement benefits in both the public and private sectors; to stem the growth of outstanding pension liabilities; and to reduce fiscal cost to government, stimulate domestic savings, generate pool of long term funds for developmental projects and increase private investments.

    These objectives and many more seems to have been significantly achieved within the 15 years of the reform.

    Head, Branding & Communications, Pension Fund Operators Association of Nigeria, Wale Odutola said the monies from the pension fund have been deployed into critical areas of the economy.

    Odutola who is also the Managing Director, ARM Pension Managers, said the deployment is perhaps not as diversified as expected to fully support the growth in the economy but they are on the right path.

    He said what is most crucial to the industry now is how the fund will have more impact in the next 15 years.

    He noted that the sector sees the next phase of growth in micro pension but noted that it is going to be hard.

    He said: “We have had 15 decent years within the pension space but the next 15 years are probably even more important because the challenge then becomes:  How do we grow from about N10 trillion to N20 trillion? And by growing, I am not talking about investment performance but how we will add more people to the pension industry such that the we all can begin to benefit from it and have some sort of security when we retire. This remains the biggest challenge for us as a sector.

    “We were having subscribers in the high of between 10 and 20 per cent in the first 10 years in the sector but that has slowed to like below 10 per cent to about 12 per cent. Clearly, growth has slowed considerably in the sector. So how do we push and ensure that coverage is more widespread and more people join the scheme? So we are looking at the next phase of growth.

    “The next phase of growth for us is in micro pension. But it is not an easy prospect to grow because first of all, historically in Nigeria, we don’t have a strong savings culture. Secondly, micro pension scheme is not compulsory like the CPS. Thirdly, the macro issues that we have where we see unemployment rate increase over the last two years, and the spending power of Nigerians diminish over the last two years also makes it very challenging. So with all these challenges, the question is how do we make sure that the micro pension initiative is successful and increase coverage of Nigerians.”

    Read Also: PTAD to pensioners: beware of fraudsters

     

    The Head, Corporate Communications, National Pension Commission (PenCom), Peter Aghahowa said part of the achievement is PenCom’s significant progress in building institutions.

    He noted that presently, there are 22 Pension Fund Administrators (PFAs), four Pension Fund Custodians and six Closed Pension Fund Administrators; as well as systems and processes in the implementation of the CPS which according to experts, can stand the test of time.

    He said there is no other sector in the financial services sector that has consistently, over such a short period of time, grown so much capital from almost nothing to about N9.5 trillion.

    He further disclosed that the PFAs have registered 28,000 informal sector workers comprising members of textile, garment and tailoring associations, Keke Napep and okada riders’ associations, butchers associations, and workers in the movie and performing art industry into the Micro Pension Scheme as at October 2019.

    “Up till June 2019, 21,430 participants were registered under the micro pension and 221 participants were registered as at July 2019. As at August 2019 1,299 participants were registered by 19 PFAs under the micro pension scheme and 2,737 participants were registered as at September 2019,” he said.

    He listed low financial literacy, low registration; low awareness about the scheme and inadequate platform to support the scheme.

    He however assured that the commission is doing everything possible to end the challenges confronting the scheme.

    According to him the commission is engaging and working with National Identity Number (NIN) and other agencies to resolve the issues.

     

     

  • Pension complaints and solutions

    ANA: In care of Nigeria Immigration Services Nasarawa State Command, Lafia, Nasarawa State. The Editor, The Nation Newspaper, 27B Fatal Atere way, Matori, Lagos. Attention: Omobola Pension Solution. Complaint For The Payment Of Outstanding Pension And Gratuity Sum of N 1,723,275.33. Omobola, kindly assist me solve this problem. I am Mr. Tor, a retired officer with the Nigeria Immigration Services. I was in service at the time of introduction of PenCom in 2004. By 2006, I registered with first Alliance Pension and benefits limited in the first instance which has now metamorphosed into ARM pension managers. But certificate issuance was unusually delayed and no explanation was advanced. This unexplained delay created anxiety prompting me to register with another pension manager, Stanbic IBTC pension Managers with a different pin number. I retired in May, 2016. By December 29, 2016, I applied for harmonization of my pension managers to the PenCom into one pension manager to facilitate payment of my pension. PenCom replied me in a letter dated 1st February, 2017. In the said reply, PenCom recognized the first Pin registered with ARM as a valid PIN. That Stanbic IBTC PIN is considered invalid. That ARM Pension would retain the first valid Pin on its data base while Stanbic IBTC Pension Managers would de-activate the second invalid Pin from its data base. They (PENCOM) advised that I should maintain Retirement Saving Account Pin with ARM for all pension transactions. PENCOM also promised to reconcile the contributions in the valid Pin to ensure that total contributions there in are brought up to date accordingly, while that in the invalid PIN (if any) would be refunded to the Federal Government through its accounts with the central bank of Nigeria. To my surprise, PENCOM did not abide by their promise. Consequently, by May 2017, PENCOM paid the Accrued right-R-FGN of six million, one hundred and eighty one thousand (N 6,181,000.00) naira only into the invalid retirement saving account (RSA) of Stanbic IBTC which had a less amount of four million, two hundred and thirty seven thousand, three hundred and forty eight naira seventy seven (4,237,348.77) kobo only, while the valid pin which had Five Million, four Hundred and fifty nine thousand eight hundred and sixty nine naira sixty seven (5,459,869.67) kobo only as at that time was abandoned. This was the beginning of short payment of my pension. By October, 2018 when I discovered that a sum of N5,459,869.67 was still hanging in my valid RSA PIN, I wrote to PENCOM through my lawyer demanding a balance of N1,189,019.17 by my calculation as at that time. PENCOM did not reply my first letter. On the 15-01-2019, I wrote to PENCOM again, but as I write to you now PENCOM did not deem it fit to reply any of the letters. On the 15th April, 2019, I wrote to ARM demanding for the payment of the money domiciled in my RSA. I made it known to them that the money in my RSA with them is part of my salary deductions remitted by the Nigeria Immigration Service in accordance with the PENCOM law of 2014. To my surprise again, ARM replied on the 18th April, 2019, that they were directed by PENCON to evacuate the amount with them which now stand at N5,860,624.10 to Contributory Pension Account (CPA). Consequently, my request cannot be met since my account balance with them now stand at zero. Sir, please, help sort out this problem of shortfall from my pension payment. Also, I want to know what has become of my salary deduction remitted into my valid RSA with ARM by Nigeria Immigration Service now evacuated into Contributory Pension Accounts.

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    THE NATION: The Nation will intervene by sending your complaint to PenCom. Do watch out for the newspaper publication next Wednesday for a response from the commission and subsequently every week for pension news.

    ABDULHAKEEM: I am Abdulhakeem and the Next of Kin to my late mothers (Halimat S Rabbit) benefits. I have filed all necessary documents since June 2018 and nothing is forth coming and money is supposed to help the family. I hope u hear my cry and assist us. thank you and God bless.

    THE NATION: The Nation will intervene by sending your complaint to PTAD. Do watch out for the newspaper publication next Wednesday for a response from the commission and subsequently every week for pension news.

    OYELADE: I am Mrs. Racheal from National Identity Management Commission. I have done verification since August 2016, but PTAD has not paid till date. My Pension Account Number is Annonymous and with Sigma pension. I am helpless living a hard life. Please, kindly assist me so that I can take care of my health.

    THE NATION: The Nation will intervene by sending your complaint to PTAD. Do watch out for the newspaper publication next Wednesday for a response from the commission and subsequently every week for pension news.

  • PTAD verifies 11,363 agencies’ pensioners in North central

    Pension Transitional Arrangement Directorate (PTAD) has verified 11,363 parastatal pensioners under the Defined Benefit Scheme in the Northcentral region of the country.

    A statement by the Directorate stated that the exercise, which began October 21, ended on November 2.

    The statement read: “There were four centres located at Ultimate Multipurpose Hall, New Yidi Road, Ilorin, Posh Garden Marquee, Plot 12 Eastern Bye Pass (Beside Hausa Block Industry), Minna, Kafas Multipurpose Hall, No 193, Okene/Kabba Lokongoma Phase II, Lokoja and Usiju World Limited, Plot 731, Apollo Crescent GRA Jos.

    ‘’The exercise witnessed a large turnout of pensioners, including a first-class Emir of Yashikiri, Barunten LGA, Kwara State, among others. The exercise produced a total of 11,363 verified parastatal pensioners during the two-week exercise.

    ‘’The breakdown of the numbers verified showed Ilorin Centre had the highest number of 3,453 followed by Lokoja Centre with 3,269 pensioners. Jos Centre had 2,895 and Minna Centre had 1,746.’’

    It said in line with PTAD’s tradition, the pensioners were treated with respect and empathy, adding that the exercise was conducted in a serene environment where pensioners were provided with lunch and medical facility to take care of any emergency. Senate Committee Chairman on Establishment and Public Service, Senator Ibrahim Shekarau, who was at the Lokoja centre to monitor the exercise,  said he was satisfied with the verification processes and pledged the support of the National Assembly to the Directorate.

    “The Executive Secretary, Dr. Chioma Ejikeme, who was at the various centres, appreciated members of the National Assembly for their love for the senior citizens and support for PTAD towards improving the welfare of pensioners.

    ‘’She thanked the staff for their commitment and the pensioners for their cooperation. She assured that the upcoming verification exercise in Abuja will include all the feedback received during the North Central verification exercise.”

    The directorate stated that the next phase of the exercise is scheduled  for Abuja from Monday, November 18. It added that pensioners who missed the exercise in their zone should take the opportunity of Abuja exercise to be verified.

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    Pensioners do not need to be anxious about being verified as the directorate has the capacity to verify all pensioners who present themselves for the verification within the period slated for the exercise, it added.

    “Abuja Verification is scheduled to hold between November 18  and 23 at the following centres: H & C Event Centre, Behind Zoological Garden, Garki Area 1, Holy Trinity Event Centre, 36 Aguyi Ironsi Street, Maitama, and NAOWA Event Centre, Mambilla Barracks, Asokoro, Abuja.

    ‘’The exercise is strictly for parastatal pensioners and does not include Customs, Immigration, Prisons, Civil Service, Police pensioner and others that had already been verified by PTAD,” the directorate added.

     

  • Lagos prepares 1560 workers for retirement

    Lagos State Government has prepared 1560 staff members drawn from the Public Service, parastatals and local government due to retire between January and June 2020 for life after work, the Director General, Lagos State Pension Commission (LASPEC), Mrs Folashade Onanuga, has said.

    She spoke during a seminar for the  workers aimed at preparing them for retirement and how to achieve easy access to their benefits.

    She disclosed that the commission is expecting a total of about 1620 to retire.

    She stated that workers were educated on documents and other paper work they would need to provide to the commission.

    She said this would enable the commission to have the information of the prospective retirees, while they process the funds in their Retirement Savings Account (RSA).

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    She urged the workers to learn all the steps they needed to live a good life  after they quit government’s work.

    Mrs Onanuga said: “The issue of retirees’ health is key as well as the issue of finances. The need for them to begin writing a will is very germane because in the dispensation, if you are going through the programme withdrawal mode, there is no way you can access your RSA if a death occurs without a letter of administration.

    “So, this meeting is to make the prospective retirees have in-depth information, which is very crucial to giving them a beautiful life after retirement. The process involves us alerting and preparing the state directors that these people will retire soon and their funds should be available. We want to ensure that when anybody retires from Lagos, their entitlement is paid on time.’’

    She said the seminar also afforded workers to recapture their data with their Pension Fund Administrators (PFAs) as mandated by the National Pension Commission on data recapturing.

    Without this data recapture the workers could not have access to their RSA when they retire, she noted.

  • Pension complaints and solutions

    JOSHUA: Dear Omobola, my name is Joshua. I retired as a Sergeant on grade level 05 step 4. My date of first appointment January 20, 1986 and date of retirement is on march 1, 1997. I have done verification in Abuja. Please I am koboless and pray you to tell Pension boss that she should pay my pension. I am helplessly living a tortures life.

    PTAD: The pensioner’s complaint has been reviewed by the operations department. He will be paid as funds are allocated and released by the FG.

     

    ISA: Good evening, Madam, this is from one of the pre-1996 Railway pensioners in Nasarawa State. My name is Isa. Our 18-month arrears (part of 52 months) since the tenure of former President Goodluck Jonathan is yet to be cleared. Also, railway pensioners are the least paid nationwide. Kindly use your good office to help and solve our problems. We “THANK YOU” for being there for us.

    PTAD: It is an assumed liability by some group of pensioners in the NRC. The group is yet to forward any supporting documents.

     

    STEVEN: I am a retired teacher from Ifako International School. I was receiving pension of N24,684.76 but since 2003, nothing has been given to me. My NPF number is ANNONYMOUS. I will be happy if you can help and see that the money is paid. I also worked at Barachel Model College.

    PTAD: The pensioner was called several times with no response. He is advised to send his complaint, name and account details to complaints@ptad.gov.ng.

     

    ONIYE: God bless The Nation’s Pension Column. My name is Mrs. Oniye. I retired from Federal Government College, Idoani in April 1999 as Grade 2 Typist, G.L 5 Step 10. My gratuity was paid on June 7, 2007. I have not been paid any monthly pension. Please attend to my problem by helping me to contact the Pension Transitional Arrangement Directorate (PTAD) on non-payment of my monthly pension since 1999.

    PTAD: The pensioner is advised to send her complaint, name and account details to complaints@ptad.gov.ng. Her telephone number is not reachable.

     

    BENJAMIN: I am Benjamin. I retired in 2006 under the old NEPA/PHCN and by transition from NELMCO to PTAD. My monthly pension of January and March 2015 were omitted. I went to PTAD five times and did all what I was told to do but to my surprise, each time I went there, they would tell me ‘no fund’ Please intervene for me.

    PTAD: The pensioner is required to submit his bank statement from July 2014 to date to PTAD office Abuja, including his complaint to enable us investigate and resolve his complaint.

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    ALICE: My name is Alice. Well done and thanks for The Nation’s concern on pensioner’s matters. My pensioner number is Annonymous. I did verification since August 2017, but PTAD has not paid me till date. Kindly assist, several pensioners have gotten their pension. I am a state pensioner with federal share. I retired on April 30, 2008 without payment till date. Thank you.

    PTAD: The pensioner’s complaint has been investigated. She will receive payment as funds are allocated and released by the FG.

     

    SUNDAY: I retired in June 2003 from the service of former governmet agency changed to National Clearing and Forwarding Agency. I received my pension from March 2008 to April, last year. But they stopped my pension after April and I don’t know why. Please help me.

    PTAD: If Mr Eshiet has been verified we advise that he send a clearly scanned copy of his verification slip to complaints@ptad.gov.ng. If he has not been verified, he can visit our Abuja or Lagos office with his employment documents, BVN and original stamped bank statement from April, last year till date to be verified and monthly pension payment resumed if eligible.

     

     

  • Lagos pays N1.1b accrued rights

    The Lagos State Government has paid N1.18billion  as accrued pension rights  into the Retirement Savings Accounts of 279 retirees.

    The Director-General, Lagos State Pension Commission, Mrs. Folashade Onanuga, said in a statement that the retirees were presented with their Retirement Benefit Bond Certificates during a ceremony in Lagos.

    She said the administration of Governor Babajide Sanwo-Olu is paying great attention to pensioners in the state., assuring them of its interest in their well-being.

    Read Also: PTAD to pensioners: beware of fraudsters

    She said the  Commissioner, Ministry of Establishment, Trainings and Pensions, Mrs. Ajibola Ponnle, was pleading their case on issues relating to pensioners at the State’s Executive Meetings, saying the issue of backlog has received due consideration and that very soon, additional funds would be released in tranches.

    Mrs. Onanuga advised the retirees on the need to eat right, rest and most importantly, be prudent with their finances.

     

  • Pension complaints and solutions

    Pension fund contributors’ yields on N9.4trillion pension fund may soon drop, no thanks to thanks to a new policy of the Central Bank of Nigeria (CBN), writes Omobola Tolu-Kusimo.

     

    YUSUF: I am Yusuf. My monthly pension is supposed to be more than N951.91. PTAD should please tell me the exact amount and the remaining arrears.

    PTAD: The issue of short payment of monthly pension. The pensioner served the Federal Government for one year three months 29 days on grade level 9 step 3. These are the parameters used in computing his pension and it was observed that he is not being short paid.

    FOLORUNSO: My name is Folorunso. I am an Ogun State pensioner with federal share. Since retirement in November 2006, the federal share of my gratuity and pension arrears between November 2006 and June 2010 have not been paid, despite verification, data submissions and appeals. I will be grateful if my case can be looked into and payments effected. Thank you.

    THE NATION: The Nation will intervene by sending your complaint to PTAD. Do watch out for the newspaper publication next Wednesday for  response from the Commission and subsequently every week for pension news.

    ZAKARI: Hello Omobola, my name is Zakari from Niger State. I am the next-of-kin, who sent SMS to seek your assistance to come between PTAD and I over the non-payment of my father’s death benefit since October 15, 2017 that I was verified by PTAD. I sincerely appreciate you and The Nation for your intervention because I have seen my complaint and response from PTAD in the newspaper. Since the publication, I have visited PTAD office in Abuja two times. After our verification in October 2017, PTAD scheduled verification for NITEL retirees and their next-of-kin on February 28, last year and it took PTAD some months before they finished the verification. Later, we heard that PTAD was about to pay the NITEL retirees and their next-of-kin, but we didn’t believe it until one of my friends, a next-of-kin, whose father is also dead received payment. I immediately travelled to Abuja to know why or how it is possible those who had their verification after us got their money before us. The response I got was that they only pay 500 next-of-kin of NITEL, but that they would pay us as soon as they received money from the Federal Government. This was between June and July, last year. This year, PTAD has abandoned our categories again and paid some next-of-kin of another organisation called Nigerian or National Savannah. I travelled again to Abuja and they still assured me that when they got money from Federal Government, they would pay us. Please help intervene again.

  • CBN ban on OMO threatens N9.4tr pension investment returns

    The exercise of the discretionary power of the Central Bank of Nigeria (CBN) to regulate the economy may soon have a negative impact on the country’s N9.4 trillion pension funds.

    The CBN had, in a circular signed by its Director, Financial Markets Department, Angela Sere-Ejembi, directed  banks to exclude individuals and local corporates from investing in Open Market Operations (OMO) auctions with effect from October 23, this year.

    The development is expected to drive foreign inflows by restricting individuals and local corporates, leaving only the banks and foreign investors to participate at the auction.

    Before now, pension fund operators had always invested 70 per cent of the total pension fund in treasury bills, an investment window that has now been shut by the CBN.

    The operators are in a dilemma as to where to invest that could be considered as safe as investing in Federal Government securities.

    Pension Fund Operators Association of Nigeria (PenOp) President, Mrs. Aderonke Adedeji, who spoke at the PenOp’s yearly media seminar in Lagos over the weekend, stated that the return on investments (RoI) would be affected even as investment risks become very obvious.

    PenOp is the umbrella body for Pension Fund Administrators (PFAs).

    She also expressed concern that it has become a challenge for the operators to continue to find investment channel.

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    She said before now, CBN had expanded its operation on the OMO issuance by allowing local corporates to participate in the market.

    She said the PFAs found investment in treasury bills safe with fair yields and had invested heavily in the market.

    Adedeji added: “Within the period that CBN had allowed us participate in the market, investment in treasury bills moved from about $2trillion to $17trillion, with local corporates accounting for between $5trillion and $7trillion while foreign investment accounted for $5trillion to $6 trillion.

    “Overall issuance of OMO far outstrips what the Debt Management Office (DMO) issues in local treasury bills and we are heavily invested in the market. But with the new directive, it means that we are not able to participate in the market going forward and this has a number of limitations for PFAs.

    “The first is when those monies mature over the next 12 months, where do we go to. The development will expose us to major investment risks as those treasury bills mature. We know that rates have come down significantly as a result of the new restriction which is what the CBN wants to achieve so that hopefully borrowing rates will drop as well and banks will then be forced to lend to local corporates and use that to stimulate the economy. But on the other hand, it puts us in a difficult position where we ultimately will learn how to in the absence of other windows, invest this money. Perhaps give the banks the money as deposit for them. It’s a difficult time that we as PFAs are in and we need to find other avenues to invest the money.

    “Ultimately, it means sometime soon, we will see return figures for the PFAs on Retirement Savings Account holders (pension contributors) reflect this fact. The return will go down. It also means that investment risks become very obvious as we begin to feel the impact. We are hopeful that as CBN reduces the issuance of OMO bills than perhaps to DMOs then it will give us the opportunity to participate within the space again.”

    She further stated that it had remained a challenge for them to continue to find investment channel.

    “We have a situation where our economy is growing but in terms of investment instrument, the market is still not as deep as what we will like to see. So, our funds are growing but there isn’t enough diversification in terms of what we can do with the resources.

    “It is something that we need to keep going to the drawing board. If we had a situation where the economy is growing a lot faster, I think we will see a lot more instrument and investment innovation,” she added.

    But the pension regulatory body, the National Pension Commission (PenCom), thinks differently.

    For PenCom, the development puts to test the professional investement capacity of the PFAs.

    PenCom Head, Corporate Communication, Peter Aghahowa said the Commission believes the PFAs are professionals in terms of investment.

    “So, if one outlet closes, there are other outlets in line with the pension investment guideline. This is where professionalism comes to play. Yes, one area that has high yields by the regulation of CBN has been affected.

    “But from our point of view, we don’t think it is much of a problem. It only calls to test now, the professionalism investment department of the PFAs. We believe that there is capacity to ensure that we get fair returns from the investments. The whole idea for CBN is about liquidity management,” he added.