The Nation Newspaper

Category: Pension

  • ‘Japan pension fund’ll double local stocks to 24%’

    Japan’s $1.2 trillion pension fund will double its allocation target for local stocks, according to analysts, who’ve ratcheted up expectations for equity buying while sticking with projections for a reduction in bonds.

    The Government Pension Investment Fund will increase its domestic equity allocation to 24 per cent of assets from 12 per cent, according to the median estimate of 12 fund managers, strategists and economists polled by Bloomberg over the past two weeks. That’s up from 20 percent in a similar survey in May. The Topix index soared four per cent on October 20 on a Nikkei newspaper report that the fund would set a 25 per cent local-share target.

  • Legacy Pension Managers eyes informal sector

    TO grow its share of the market, a leading Pension Fund Administrator (PFA), Legacy Pension Managers Limited, is planning to go into Nigeria’s hugely under tapped informal sector.

    The move, which would it leverage on its yet-to-be released guidelines by the National Pension Commission (PenCom), would see the PFA explore effective strategies, such as bond building with operators in the informal sector to enable it penetrate the market.

    The pension managers, which has also paid over N20 billion in benefits in its eight years is also aiming to expand its information technology infrastructure to enable it boost its customer service delivery.

    Disclosing this at the sidelines of its  Customer Forum  in Lagos, Moustapha Muhammed, General Manager, Legacy Pension Managers Limited, said having seen a substantial growth on all fronts, against the backdrop of a consistent and focused management team, the firm is now set to grow its market footprint into the informal sector.

    “Since inception, we have had a stable and credible management board and this is a huge advantage for us, “ he said.

     

  • What you should know before retiring

    What you should know before retiring

    Retirement can become a nightmare if you are not paying attention now.  Adequate planning for your financial needs in retirement is key, reports, Omobola Tolu-Kusimo 

    Whether one is retiring according to the rules, or by expediency, the most important factor to consider is preparedness. Most people planning towards their retirement start late, leaving issues about their retirement until the last few years of their working life. But leaving  planing for retirement till this stage is dangerous.

    Most retirement educators advise that serious preparation should commence about 20 years to the time of retirement. However, from the recent developments in the labour market, it cannot be too early to start preparation for retirement from the first day of employment. Such an arrangement will certainly benefit both the employee and the employer. If the former understands that his future is assured, he is more likely to remain stable and render loyal service to the latter.

    For Nigerian workers, who are especially challenged by low levels of income and savings as well as huge family and social responsibilities, retirement planning can be more complicated. Some of the social issues affecting effective retirement planning in Nigeria include the size of our families, polygamy, additional responsibilities of an extended family, and inadequate access to medical facilities.

    In addition, Nigeria does not have an operable social security system that takes care of the aged, the young unemployed, and most disturbingly, the disabled, meaning that all these categories of people constitute an additional responsibility on the worker and his or her resources.

    Under the Contributory Pension Scheme and with the improved law, Pension Reform Act, 2014, guiding the scheme, retirement planning has taken a new and more promising dimension. The new scheme is compulsory for Nigerian workers in the private and federal public sectors, and is being embraced by many state governments, ensuring that workers receive their benefits as at when due, and establishing a uniform administration and regulation of retirement benefits in Nigeria.

    Retirement as stipulated in the Act is when an employee attains the age of 50 or the retirement age of the organisation, whichever is later. At this point, the employee is able to access 100 per cent of the balance in his or her Retirement Savings Account (RSA). This balance can be accessed either by a programmed withdrawal with your PFA or by purchasing an annuity scheme from an approved insurance company.

    The Managing Director, Stanbic IBTC Pension Managers, Demola Sogunle said retirement planning should start while you work. He noted that under the new contributory pension scheme, workers can actively participate in decisions regarding their retirement. From the choice of Pension Fund Administrator (PFA), to additional voluntary contributions and well planned withdrawal modes, workers can plan and ensure a safe and secure retirement.

    He said other issues such as owning a home, taking life insurance policies, writing a will and setting aside towards your health care in retirement are issues that young workers should be concerned with.

    He stressed that workers planning towards their retirement should also seek to monitor closely the performance and activities of their PFAs, and other financial advisors. “Workers must be aware that the choice of a PFA is a serious decision that should be made after serious consideration. Many workers have chosen PFAs based on subjective reasons, and many others have simply followed the bandwagon, without proper enquiry.

    “A proper enquiry into the PFA’s experience and track record in investment management, financial resources, quality of ownership and management as well as quality and transparency of customer service and reporting should be made before a choice is made. The law guiding the contributory pension scheme allows workers to switch PFAs at least, once in a year without any reason, meaning that people who may have made sub-optimal decisions regarding the choice of PFA can easily and conveniently change to another PFA,” he stated.

    Sogunle said another issue in planning your retirement while you work revolves around changing jobs and redundancy. For the upwardly mobile worker, he said, changing employers under the new contributory scheme poses no challenges at all adding that the RSA is portable, and all that will change is that your old employer would stop contributing, and your new employer will be informed of your account details, and will continue contributing on your behalf.

    He posited that taking an early retirement is also something that a lot of young workers consider today. He said people in very high energy professions like banking suffer burn outs and fatigue after years of working, and wish to retire at about 45 years or so to settle for a less demanding personal or family business. Decisions like this are becoming increasingly popular. “People should plan adequately towards an early retirement, and where they want to run a private family business, should thoroughly research it, so that it doesn’t become another high-stress activity like their previous employment,” he said.

    Sogunle also stated that while an employee is still at work, there is need for him or her to establish a retirement plan. According to him, retirement planning involves all activities from your first employment, up to and after your retirement geared towards ensuring that you and your needs are well provided for in the retirement phase of your life. In drawing up a retirement plan, it is critical to identify when you will retire, what you will do during retirement, what kind of income you will need in retirement and what kind of income you can expect in retirement.

    He advised that depending on your outlook, and personal circumstances, people may choose to retire early, say before 50 years, while others will retire later, just at 60 years, or for however long their terms of employment permit.

    He said: “Many factors including your state of health, desire to pursue other activities, and very importantly the level of financial resources and responsibilities will affect the timing of your retirement. For some others, however, the timing of retirement is not entirely up to them. Sometimes accidents, ill-health, and employer-distress may lead one to a premature retirement.

    “During retirement, some people choose to continue in very active work, supporting their communities, participating in politics or even running a full time business. Others on the other hand, choose to limit themselves to very light activities, if any at all, and prefer to spend their retirement traveling, visiting children and grandchildren, among others. It is important to plan ahead on how you will like to spend your retirement, and prepare yourself mentally and financially for whichever route you choose to follow.

    “Planning adequately for your financial needs in retirement is also very important. It is therefore, necessary to ascertain ahead of time, how much income you will need in retirement. In planning towards this, one may have to gauge his family responsibilities, state of health, and expected life expectancy. For example, if you still have children of school age during your retirement, your financial needs will outstrip those who do not. If you already live in your own house and will not be paying rent during your retirement, then your financial needs will differ from someone who does not own a house.

    He further advised that once you have ascertained your financial requirements in retirement, it is necessary to estimate your income streams to be available in retirement. “For someone who has planned his retirement early enough, this could consist of income from investments such as dividends, capital appreciation, rental income as well as pension and other retirement benefits. Estimating your sources of income is important to enable you plan how to meet your living requirements in retirement,” he said.

    He said an employee can be retired through mandatory, voluntary or compulsory retirement and on medical grounds. He explained that compulsory retirement occurs when an employee is being disengaged or terminated from active service in accordance with the terms and conditions of service, before attaining the age of 50 years while mandatory retirement occurs when an employee disengages from active service at the retirement age or completion of the length of service based on the terms of his or her employment after attaining the age of 50 years.

    “A retiree in this category will be entitled to the balance in his or her RSA and this could be disbursed either in block payment, provided the balance in the retiree’s account is less that N550,000.00 or as a combination of lump sum and programmed withdrawal payments or lump sum and annuity payments purchased from an insurance company.

    “Retirement on medical grounds shall be when an employee disengages from active service based on the advice of a suitably qualified physician or medical board certifying that the employee is no longer mentally or physically capable of carrying out the functions of his/her office due to total or permanent disability either of mind or body.

    An RSA holder retiring on medical grounds can access the balance in his/her RSA account. This could be disbursed either in block payment (provided the balance in the retiree’s RSA is less than N550, 000 or as a combination of lump sum and programmed withdrawal payments or annuity).

    The Managing Director, Leadway Pensure Limited, Mrs. Ronke Adedeji said for public sector employees to access retirement benefits, the employee will need to attend the National Pension Commission (PenCom) verification and enrollment exercise, the year before the retiring year. This she said will ensure the remittance of accrued benefits rights.

     

     

     

  • Lagos Water Corporation pensioners lament non-payment of benefits

    Lagos Water Corporation pensioners lament non-payment of benefits

    Retirees of the Lagos State Water Corporation have cried out over the non-payment of their several benefits amounting to about N1 billion that is owed them since 2010 by the corporation under the leadership of Mr. Shayo Holloway.

    The retirees, numbering about 150, have been demanding payment of the benefits since a few years ago. They have now drawn the battle line with the corporation and have petitioned the Governor Babatunde Fashola, stating that the management plotted them out of all forms of benefits, which amounted to about N1 billion as at 2013.

    The Chairman, Association of Retirees, Lagos State Water Corporation, Mr. Leo Onayemi, who made this known in Lagos, said the amount, which includes bonds and other emoluments started accumulating since 2010.

    “There is this lump sum that has been there since 2010 and as at 2013, it amounted to about N1 billion and we have been doing everything to get the attention of the group managing director but it has not been successful,” he said.

    He alleged that the management of Water Corporation had failed to maintain the life insurance policy in favour of the employees for a minimum of three times the annual total emolument of the employees as enshrined in Section 15 of the Lagos State Pension Reform Law.

    He said: “It is glaring that the Group Managing Director (GMD) of Lagos Water Corporation has no regard for the Lagos State Pension Reform Law. He has dismissed the law with impunity. He has refused to budget for all the staff of the corporation on a yearly basis as regards staff bonds, insurance, taxes, among others, which naturally would have been approved by the Lagos State Government under the leadership of Babatunde Fashola, who has never defaulted in paying as at when due, the retirees that are directly under the state government.”

    He also alleged that the GMD had resorted to reengaging some retired management staff of the corporation as a ploy to scuttle any form of collective agitation by the embittered members of the association.

    “We all say ‘No’ to this reengagement, especially that of the management team. The GMD should allow the young ones to grow in the system and contribute their own quota to the development of the corporation,” he added.

    On the way forward, Onayemi recommended that a dedicated or consolidated fund should be created and managed by a special committee to ensure funds for the corporation workers yearly; direct deduction from statutory allocation or subvention due to the corporation; using the corporation’s Group Account Revenue to offset all the backlogs of entitlements of the retirees in payments of their bonds, insurance and five per cent redemption fund to the relevant authority as at when due including paying the pension deductions of staff to the appropriate Pension Fund Administrator.

    Responding to the petition, the governor, through the Commissioner for Budget and Planning, Mr. Ben Akabueze, said he would look into it and other grievances of the corporation.

    He stressed that the corporation’s problem was peculiar because it did not fall in the same group with other organisations, which enjoy full retirement benefits.

    Lagos State has been well disposed to regular payment of benefits to all its retirees across board. Recently, Fashola disclosed that the Contributory Pension Scheme had imposed a huge financial burden on the state’s finances.

    He said before the pension reform by the Federal Government in 2004, the state’s pensioners faced the risk of a life of penury due to the unfunded nature of the Pay as you Go Pension Scheme in the public service and the lack of provision of pension arrangement for employees in the private sector.

    He said: “The risk of the elderly not having financial independence and dying in poverty was real and to eradicate this risk, the Lagos State Government subscribed to the fully funded Contributory Pension Scheme.

    “It imposed on us a huge liability as we needed to pay of 7.5 per cent of basic salary, housing and transport allowances as monthly pension contribution; fund the Retirement Bond Redemption Fund Account with five per cent of employees monthly total emolument figure to provide for accrued pension rights, being entitlements for years spent in service before the commencement of the contributory pension scheme. We pay the annual premium to guarantee the life assurance cover as stipulated in the law and which is intended to provide a death benefit of at least three times the annual total emolument of each employee.”

     

  • New PRA 2014 is game changer for Nigerians, says Adedeji

    New PRA 2014 is game changer for Nigerians, says Adedeji

    The new Pension Reform Act (PRA) 2014 is a game changer that has come to save Nigerians from the problem of inability to save by using part of their savings as equity towards getting mortgage facilities, Managing Director, Leadway Pensure PFA, Mrs. Ronke Adedeji, has said.

    Adedeji, a member of the Pension Fund Operators Association of Nigeria (PenOp), stated this while speaking with reporters in Lagos on the benefit of the Contributory Pension Scheme (CPS) under the new law at a media retreat organised by PenOp in Lagos.

    Highlighting other notable changes in the PRA 2014, she said  employers can no longer hide behind the fact that some workers are casual or contract staff.

    She noted that the new law states that any worker under any form of employment is entitled to a Retirement Savings Account (RSA) because whichever account an employer uses to pay salary is portable.

    She stated that casual or contract workers who decide to spend their working career under contract from one employer to the other are entitled to have RSA account that employers can remit pension contributions into.

    She noted that Group Life Insurance remains mandatory but employers who don’t provide life insurance for their employees will no longer get away free. She said: “The new development is that the law now specifies that if an employer does not provide life insurance, he is liable to pay the deceased beneficiary the entitlement or be sued. So peradventure, an employer decides to save money rather than obey the law and pay life insurance premium, the beneficiary has a right to sue the deceased employer.

    “Proceeds of life insurance can now be directly paid to the deceased beneficiary. Before now, the life insurance company has to pay proceeds of life insurance to Pension Fund Administrator (PFA) who will credit their RSA account and the burden was on us to track the beneficiary. This was a source of challenge for us. Very often, because the deceased did not update his or her information after registration, it is difficult for us to find the beneficiary. But the new law now places that burden on the insurance company like it was before the 2004 PRA. So when someone passes on, it is the responsibility of the insurer to look for the beneficiary and pay the life insurance proceeds.”

    Adedeji also said the previous law only mentioned participation by public service of the federation and private sector and left out state and local government adding that the state and local government felt they were at liberty not to comply.

    “The new law has clearly included the state and local government. The law has also expanded coverage from minimum of three employees to five employees. Another interesting thing is that anyone who is not in any of these three categories can still have a RSA through voluntary contribution. Other notable change is clear mention that contributions, income and benefit payments are tax free.”

    She described the provision of mortgage as a game changer for every Nigerian noting that people have been clamouring for accessibility to their pension savings before old age.

    Contributors usually lament lack of access to their RSA account when they have needs. With the new law, an individual can use part of his balance in his or her account as an equity contribution towards getting a mortgage facility. We as the PFAs are only waiting for the guideline by the National pension Commission (PenCom) to implement this aspect of the law, she added.

  • Adeola warns on investment of N4.5t fund

    Adeola warns on investment of N4.5t fund

    Ensuring the safety of pension funds, which has grown to N4.5 trillion in the last 10 years,  is more important than releasing it for equity or infrastructural investment, former Managing Director, GT Bank, Fola Adeola has warned.

    Adeola, who is also the head of the committee that set up the Pension Reform Act 2004 under the administration of former President Olusegun Obasanjo, gave the warning while speaking at the commemorative dinner of the 10th anniversary of the pension reform in Nigeria organised by the National Pension Commission (PenCom).

    He cautioned the regulatory body, PenCom, to de-emphasise disclosing the figure of the accumulated funds to the general public so that people do not always think the money belongs to the commission.

    He urged PenCom to advise all the people clamouring for investment of the money in the capital market, real sector, among others, including the President Goodluck Jonathan that the security of the fund is paramount.

    He said the money is primarily for people who have worked all their years either in the private  or public sector. What would happen to a man who after 35 years of work cannot move or get his benefit, he queried.

    He said: “In restructuring the 2004 Pension Reform, what we wanted to achieve was a system that will take money out of the system into private hands and regulated by government. Today, people are in constant touch with their money. I didn’t mind that there should be no interest but safety.

    “Left to people in the capital market, all the money should be in equity; those in infrastructure want it in real sector. The fund was at zero 10 years ago and today it is N4.5 trillion but what will it be in the next 10 years if it is messed up.”

    Adeola said some organisations have to opt out of the scheme because they want to go back to the system they are used to which is open to fraud. “There is no amount of money that cannot finish and it is the way we handle the money that will determine whether it will be there forever.

    “For PenCom, the idea is not to be telling people there is N4.5 trillion because it is not their money. They are not a signatory to it either. It is something that PenCom should educate the President and work with him. This is the anchor for my vision for the next 10 years and as we are getting bigger, let’s be careful on how we release money to infrastructure, among others. If you put out 10 per cent of the money and you lose it, you are dead.”

    The greatest thing here is trust and when broken, it is an end coming, he said.

    PenCom Director-General, Chinelo Anohu-Amazu in her address, said the 10th anniversary of the pension reform in Nigeria commemorates the milestone of a journey, which sought to break Nigeria away from an endless cycle of despair in its pension sector and launch it into a new era of blissful retirement for all employees.

    She stated that the assemblage brought together private sector leaders, the icons of the pension reform and other important stakeholders to celebrate as well as usher in the strategic focus of the reform as it transits into the next decade.

    The ring-fencing of pension fund assets and regulatory noninterference, according to her, has resulted in the consistent growth in a large pool of pension assets of over N4.5 trillion, which are invested in structured and safe financial instruments; and a remarkable growth when compared with huge estimated pension liabilities in the public sector prior to the reform in 2004.

    The reform has also engendered a regime of regular payment of retirement benefits to all employees who retired under the scheme since 2007 without delays as was the practice in the old system.

  • PAL Pensions extend financial literacy campaign

    Pension Alliance Limited (PAL) has taken its financial literacy campaign to more schools in Lagos and other parts of the country, having successfully completed phase one of the project, which kicked off on Children’s Day.

    In a statement, the company’s Executive Director Finance and Operations, Godwin Onoro, said the second phase took place at Baptist Academy, Obanikoro, Lagos, Holy Cross Catholic Primary School, Lagos Island with 39 other schools across the country, on 30 October 2014. It was attended by pupils and staff of these schools, as well as representatives from PAL.

    According to him, being a financial institution, the company believes that inculcating the tenets of good financial management into the young generation at an early stage of life would build in them the savings culture that seem to be a problem in this present generation.

    Thus, the company takes its experts to primary and secondary schools in Nigeria to give them practical financial and economic information on how to get and use money prudently.

    He described financial literacy as one of the most crucial things that young people need to learn and understand. He said: “The organisation is a financial institution and it understands the importance of saving culture, planning and its overall effect on other aspects of life. We encourage them by giving those in primary school piggy banks, which everybody knows as ‘kolo.’ We open their minds to using their piggy banks to save now, and later open an account with the savings with a view to sustaining the saving culture eventually.” He added that they are taught the importance of planning for money and investing.

  • Stanbic IBTC Pension exceeds N1t asset

    Stanbic IBTC Pension Managers Limited, one of the biggest Pension Fund Administrators (PFAs), has recorded over one million retirement savings account (RSA) holders with assets under management in excess of N1 trillion, Chief Executive Officer, Dr Demola Sogunle, has said.

    Sogunle made this known during a conference on pension and corporate governance organised by the company in Lagos. According to him, the company pays approximately N1.8 billion to almost 30,000 retirees monthly. He said over N178 billion has been paid to retirees seamlessly since the PFA began operations in 2006.

    Speaking on corporate governance in the pension industry, Sogunle said that against the backdrop of the recently enacted Pension Reform Act of 2014, the industry now stands on a stronger foundation, providing safety for the N4.5 trillion pension assets under management.

    He stressed that the new law had expanded the scope of participation in the pension scheme by Nigerians as well as strengthened compliance with its provisions, especially relating to enrolment and remittance of pension contributions.

    He said: “The Pension Reform Act of 2014, among its very many laudable provisions, will be instrumental in expanding coverage of the Nigerian pension system and strengthening compliance, while building a vibrant pension industry capable of supporting economic growth and development.

    “Private sector organisations with three employees or more are expected to register under the scheme. The law also compels an employer to open a Temporary Retirement Savings Account (TRSA) on behalf of an employee that fails to open a Retirement Savings Account (RSA) within three months of being employed.”

    He added that whatever gaps that existed in the old pension regime had been effectively plugged in the new law, making the incidence of ghost pensioners and widespread mismanagement of pension funds almost impossible. He noted that very stiff penalties for pension funds fraudsters and employers who persistently fail to deduct and or remit pension contributions of their employees within the stipulated time are expected to checkmate abuse.

    Sogunle described as erroneous the impression often bandied in the public space that pension funds are left to PFAs, employers, individuals or operators to handle as they wish. Instead, he emphasised that pension fund assets are held by Pension Fund Custodians (PFCs) who execute benefit payments and investment instructions from the PFAs and are duly licensed by the National Pension Commission (PenCom).

    “The PFAs manage and administer the funds, while the PFCs have custody of the pension fund. There are sufficient legal and institutional bulwarks to protect pension funds. Funds are directly credited to the RSA of beneficiaries who enjoy unhindered access to any information relating to their pension contributions,” he stated.

    The former Nigerian High Commissioner to Britain, Dr Christopher Kolade, who was the guest speaker, highlighted passion for high quality, productivity and integrity as key drivers for success in business. He urged every business to strive to achieve effectiveness through best practice.

    The Executive Director, Investment Stanbic IBTC Pension, Eric Fajemisin, said the stakeholders’ forum was specifically designed to appraise recent trends and developments in the industry as part of a multi-pronged enlightenment campaign to deepen pension practice in Nigeria and to have more people enlist in the Contributory Pension Scheme. The company, he said, would always spearhead the quest for global best practice in the industry.

    He said: “Our aim is to continue to set higher standards of service delivery and ensure that our retirement savings account holders have peace of mind and derive maximum value from their investment. We believe that the support, experience and capabilities of the Standard Bank Group, to which Stanbic IBTC belongs, have been instrumental in enhancing our expertise, resource base and general service delivery. This initiative is part of a long-term commitment that defines Stanbic IBTC Pension’s value proposition to its customers and to the industry in general.

    “Innovations introduced by the PFA to enable clients experience excellent and convenient service delivery include the Stanbic IBTC Pension Managers mobile office; the first 24-hour multilingual call centre manned by personnel who speak the three major Nigerian languages – Yoruba, Igbo and Hausa; as well as Pidgin English; a footprint of over 200 branches of Stanbic IBTC Bank where RSA clients can access pension service; Stanbic IBTC Pension Managers’  regional offices; as well as selected branches of Zenith Bank Plc. Other access points include Stanbic IBTC Bank ATMs, online service for RSA holders, email, SMS and the Pension Notes, which accompany hardcopy RSA statements sent to customers quarterly.”

    Stanbic IBTC Pension Managers is a subsidiary of Stanbic IBTC Holdings Plc, a member of Standard Bank Group.

  • ‘We ‘ll engage more in long term investment’

    With the 2014 Pension Reform Act, Pension Fund Administrators (PFAs) can now engage in long term investment in equity and infrastructure that have more economic impact as opposed to the short term investment, Pension Fund Operators Association of Nigeria (PenOp) Chairman, Misbau Yola, has said.

    Yola, who is also the Managing Director of Legacy Pension Limited, said the PFAs will however, need to bring a workable means of channeling pension fund into these areas.

    He noted that employees, employers and other stakeholders within and outside the industry now understand that their pension is safe under the supervision of the National Pension Commission and the administration of the PFA along with the Pension Fund Custodian (PFC) who are the custodian of the pension fund.

    He stated that this is also because there has been no case of fraud since the inception of the new pension scheme, the Contributory Pension Scheme in 2004. Nigerians are now more comfortable with the scheme and we expect that more people will join the scheme, he added.

  • Nigeria yet to achieve contributory pension objectives

    About 10 years after the enactment of the Pension Reform Act, 2004, which introduced contributory pension scheme in Nigeria, Pension Lawyers Association of Nigeria (PLAN) has said that Nigeria is still far from achieving the core objectives of the Pension Reform Act, 2004 repealed by the Pension Reform Act 2014.

    President of the Association, MbanugoUdenze, who spoke in Lagos said that the decision of the government to carry out a review of the Pension Reform Act 2004 was a right step in the right direction.

    According to him, apart from portraying Nigeria as a dynamic society, which undertakes periodic review of legislations to reflect current realities in the socio- political economy, the review also brought about some innovations in the new legislation, which were absent in the old one.

    He however said that it is one thing to have a good legislation, it is yet a different thing for such  legislation to adequately address the issues for which it was enacted.

    Udenze, who is also a senior lawyer and principal partner, MbanugoUdenze& Co, Barristers, Solicitors and Notary Public, said there is a great wall of difference between a fantastic legislation and the practical aspect of it, which is the implementation. He said: “Yes it is a codified law, which is good but the major thing is to see its full implementation. So in my opinion something should be done in respect of its implementation because that is how the objectives of the reforms can be achieved.

    “The Pension Reform Act 2014, which as a matter of fact is an improvement on the 2004 Act, is still work in progress because a lot of work need to be done on the part of the employers in order to ensure that the core objectives are achieved.”

    He noted that less than 10 percent of the citizens for whom the pension scheme is meant to cover are yet to be covered under it.

    He said out of Nigeria’s population of about 170 million people, it is estimated that 30 to 40 percent of this 170 million people constitutes the working class, who the pension scheme is meant to cover, who are also the productive class.

    He argued that among the 170 million population in Nigeria, I am sure that about 30 to 40 percent of them that can be said to be productive and within this 30 to 40 percent working class, how many of them are covered by this pension scheme? I think it is less than 10 percent and this is how you measure whether the core objectives of this Act have been achieved.

    To address this challenge, he said  there should be an aggressive enlightenment of the Nigerian public by the National Pension Commission (PenCom) on the need to be covered under the new pension scheme.

    He called on operators in the private sector to also embrace the new scheme, which he described as the best thing to happen to administration of pension in Nigeria.

    While responding to allegations that some employers of labour, especially in the private sector do not remit deductions regularly to the employees’ pension accounts, he charged the employees to always demand for updates on their accounts, which will keep their employers on their toes to ensure they remit deductions.

    He lauded the Federal Government on the new Pension Reform Act 2014, which he said is an improvement on the first legislation, the Pension Reform Act, 2004, as it introduced some innovations that would engender the achievement of the objectives of the legislation.

    “Some of these innovations include the increase in the contribution of the employers and employees from 7.5 percent flat contribution each on the part of both to ten percent for the employer and eight percent for the employee bringing to 18 percent of the employees monthly emoluments as against the former 15 percent.

    “Secondly, the Act also provides that for private sector operators, employers of labour with a minimum of three members of staff are eligible to participate in the contributory pension scheme as against the former five members of staff provided in the Pension Reform Act 2004, among several others,” he said.