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Tag: PenCom

  • Recover N10tr from Fed Govt, Reps tell PenCom

    Recover N10tr from Fed Govt, Reps tell PenCom

    The House of Representatives has asked the National Pension Commission (PenCom) to take steps to recover the N10 trillion loan given to the Federal Government from the nation’s pension fund.

    It said modalities should be put in place to prevent a collapse of the scheme. 

    The House resolved to investigate the status of pension fund assets of over N15,500,000,000,000.00 to ensure the recovery of the loan to the government. 

    It also urged PenCom to ensure the immediate release of funds for the payment of pension funds to all retirees who have found it difficult to access their entitlements. 

    Adopting a motion by Aliyu Bappa Misau, the Green Chamber urged pension regulators to scrutinise the failure of Pension Fund Administrators (PFAs) in fulfilling their obligations to retirees on their retirement savings.

    The lawmaker said the Retirement Saving Accounts (RSAs) is the lifeline that pensioners rely upon to cater for their needs on retirement.

    He expressed concern that most pensioners are unable to access their retirement funds, despite complying with the requirements of the contributory pension scheme. 

    According to him, neither the PenCom nor the PFAs have been able to reassure pensioners of getting their entitlements without stress. 

    Read Also: UPDATED: Tinubu seeks Senate’s confirmation of three new ministerial nominees

    Misau noted that the pension fund assets, which PenCom regulates, being the proceeds of the Contributory Pension Scheme and returns on investment, stood at more than 15,500,000,000,000.00 as at the close of the first quarter of 2023.

    The lawmaker stressed that nothing should prevent retirees from accessing their retirement savings as and when due.

    He said critical stakeholders have expressed concern that 65 per cent of the pension funds (N10 trillion) loaned to the Federal Government is an investment which exposes the contributors to unnecessary volatility.

    According to him, the Federal Government may fail to pay back the loan in due time. 

    Misau added that the inability of pensioners to access their pension has caused untold hardship to them, making it difficult for them to afford basic necessities. 

  • PenCom enhances workers’ retirement benefits through benefits schemes

    PenCom enhances workers’ retirement benefits through benefits schemes

    To workers get their retirement benefits, the National Pension Commission (PenCom) has unveiled the framework for the establishment of Additional Benefits Schemes (ABS) under the Contributory Pension Scheme (CPS).

    This move, according to  the Director-General of the commission, Mrs. Aisha Dahir-Umar, has said, aligns with Section 4(4)(a) of the Pension Reform Act (PRA), 2014, which allows employers to provide more benefits to their employees upon retirement.

    She recalled that the Act provides that, notwithstanding the pension contributions made by the employers and employees into the employees’ RSA, “an employer may agree on the payment of additional benefits to the employee upon retirement”.

    Accordingly, any employer may wish to provide additional benefits in the form of gratuity to its employees upon retirement. Employers, especially those in the public sector, could take advantage of the law to enhance their employees’ retirement benefits, she noted.

    She said: “The Framework for establishing Additional Benefits Schemes under the CPS ensures adherence to regulatory standards outlined in the PRA 2014. The aim is to promote the proper management and utilisation of pension funds.

    Read Also: PenCom kicks off online enrolment

    “To this end, PenCom issued the Framework to outline the modalities for establishing and managing ABS by employers interested in increasing their employees’ retirement benefits under the CPS.”

    Establishment of Additional Benefits Scheme (ABS)

    She pointed out that the PRA 2014 permits only institutions licensed by PenCom to hold and manage pension funds and assets.

    “Consequently, only licensed Pension Fund Administrators (PFAs) can manage pension assets. Similarly, the custody of pension assets can only be done by approved Pension Fund Custodians (PFCs).

    “Employers seeking to establish an ABS for their employees must demonstrate compliance with the PRA 2014. This includes up-to-date pension contribution remittances, Group Life Insurance cover, and execution of a Portfolio Management Agreement (PMA) with a chosen Pension Fund Administrator (PFA). Employers may appoint one or more PFAs to manage the ABS, with a lead PFA designated in cases of multiple appointments.”

    Documentation requirements

    The DG stated that employers must submit various documents to PenCom for review and approval to establish an ABS.

    “These include the draft Portfolio Management Agreement, Trust Deed, Rules of the Scheme, evidence of pension contribution remittance and Group Life Insurance policy, and evidence of employees’ Retirement Savings Accounts (RSAs). Employers also need to provide information to indicate if the scheme is a Defined Benefit or Defined Contribution and give an undertaking to comply with regulatory provisions and to fund the scheme continuously.”

    Reporting and compliance

    She further stated that the appointed PFA is responsible for annual actuarial valuations and audits, ensuring compliance with regulatory guidelines.

    “Reporting requirements stipulate submitting audited financial statements and actuarial valuation reports to PenCom within specific timelines. Additionally, PFAs or Lead PFAs must submit consolidated monthly valuation reports and fee requests to PenCom”.

    Amendments, dispute resolution, and termination

    The employer cannot alter the Trust Deed and Rules of the Scheme without prior written approval from PenCom. The Framework outlines dispute resolution procedures, emphasising arbitration and compliance with termination and winding-up protocols in line with the Trust Deed and Rules of the Scheme.

    Why additional benefits matter to employees

    Mrs. Dahir-Umar noted that the CPS is a sustainable pension system that provides a stable, timely, predictable and adequate source of retirement income for employees in the public and private sectors.

    She also said the CPS was the outcome of reforms in the pension sector initiated by the Federal Government of Nigeria in 2004, culminating in the enactment of the PRA 2004. Ten years later, the PRA 2004 was repealed and replaced with the PRA 2014.

    “Stakeholders have adjudged the implementation of the CPS in Nigeria a success. However, there are complaints about low pensions, especially from retirees in the public sector, because of the relatively low pay relative to the private sector. It is vital to state that the CPS provides a comprehensive framework that allows employers and employees to plan and save towards pensions.

    “Accordingly, employers can use the Framework for the Establishment of Additional Benefits Schemes recognised by the PRA 2014 to increase the pensions of their retired employees.

    “It is imperative to state that various options are available to employers and employees to improve the adequacy of pensions for retirees, especially those in public service disproportionately affected by low pay. Providing additional retirement benefits can have several benefits for both employers and employees. It can attract and retain talent, enhance employee morale and loyalty and improve an organisation’s reputation.

    “The framework for the establishment of Additional Benefits Schemes is a significant step towards enhancing retirement benefits for workers in Nigeria. By setting clear guidelines and compliance measures, it seeks to ensure a robust and transparent system that supports retirees and contributes to employees’ overall financial well-being in their post-work years. PenCom remains committed to periodically reviewing this framework to meet employees’ evolving pension needs and aspirations,” she stressed.

  • PenCom kicks off online enrolment

    PenCom kicks off online enrolment

    The National Pension Commission (PenCom) is set to start the online verification and enrolment for prospective retirees of Federal Government Treasury-Funded Ministries, Departments and Agencies (MDAs) who are due to retire next year, the Director-General, Mrs. Aisha Dahir-Umar, has said.

    The PenCom boss, who made this known in a statement, said the exercise would be held from October 2 to December 31.

    To adapt to pension fund administration, she stated that the commission embarked took a proactive step to simplify the process for the retirees.

    She said the commission had issued a revised guidance note to Pension Fund Administrators (PFAs) on online enrolment to ensure a smooth transition into retirement for the government employees.

    She further stated that central to this exercise is the Online Enrolment Application on the PenCom website www.pencom.gov.ng.

    She said: “This web-based application empowers prospective retirees with the tools to complete their enrolment conveniently from the comfort of their homes.The application comprises four distinct modules that contribute to the comprehensive pension enrolment process. They include Retiree Registration, PFA Module, MDA Module, and PenCom Module.

    Read Also: PenCom worried over uncredited pension contributions

    “Under the Retiree Registration Module, prospective retirees can register, scan, and upload all the necessary documents, ensuring the accuracy and completeness of their pension information. This innovation drastically reduces the reliance on manual paperwork and minimises the risk of multiple RSA PINs. PFAs are vital in this process. Therefore, they use the PFA Module for their part.The PFAs are responsible for verifying and enrolling prospective retirees, ensuring the submitted information is accurate and consistent. PFAs also guide individuals through the online registration when required.

     “Similarly, the MDA Module enables Pension Desk Officers of MDAs to upload relevant information about prospective retirees, fostering transparency and collaboration between government entities and the pension administration system.

    “The PenCom Module serves as the final step, validating the records submitted by all parties to ensure the accuracy and integrity of the pension data, thereby adding an extra layer of scrutiny to prevent errors or fraudulent activities.

    “It is imperative to note that adopting a digital approach brings numerous benefits, with efficiency and transparency paramount among them. By streamlining the process, prospective retirees can complete their registration and document submission at their convenience, significantly reducing the need for physical visits and bureaucratic bottlenecks. The outcome is timely budgetary provisions by the Federal Government for accrued pension liabilities and a smoother transition into retirement for workers.”

    The revised guidance note, according to the DG, adheres to the legal framework provided by the Pension Reform Act (PRA) of 2014. Specifically, Section 15 of the PRA 2014 mandates the recognition of accrued pension entitlements.

    She noted that Section 39 establishes the Federal Government Retirement Bond Redemption Fund (RBBRF) and outlines PenCom’s role in assessing its adequacy against projected pension liabilities.The online enrolment system aligns with these provisions, ensuring compliance and enhancing accountability within the pension administration landscape.

    “The online enrolment for 2023 consists of three distinct stages: Registration, Verification, and Enrolment. Prospective retirees can opt for the self-assisted registration or seek assistance from PFAs. Self-assisted registration involves visiting the PenCom website, creating an account, and providing required information such as RSA PIN, NIN, personal details, and employment history. Scanned copies of documents are uploaded to the system to ensure data accuracy.

    “During the verification stage, PFAs play a pivotal role.They meticulously crosscheck the information provided, ensuring alignment with the original or certified true copies of the required documents. PFAs also guarantee the completeness and accuracy of employment records, salary details, and relevant supporting documents. In addition, PFAs ensure that the scanned documents match the hard copies submitted to them. The PFA takes a live photograph of the retiree and prints two copies of the enrolment slip for the signature of the retiree. The retiree retains one copy, while the PFA has the second copy.

    “The online enrolment considers the challenges faced by sick or incapacitated prospective retirees. In such cases, a Next-of-Kin (NoK) can register on their behalf, uploading the required documents and medical reports. PFAs conduct remote verification and enrolment, ensuring that the enrolment process remains accessible to all, regardless of their physical condition”.

    Mrs. Dahir-Umar added that online verification and enrolment is a leap in pension administration.

    “By embracing technology, streamlining processes, and ensuring transparency, PenCom is simplifying the transition into retirement for government employees and setting a precedent for modern and efficient pension fund management. As the digital era continues to reshape various sectors, Nigeria’s pension administration stands at the forefront of innovation, poised to deliver better services to workers and retirees.

    “Prospective retirees of the Federal Government Treasury Funded MDAs retiring next year could look forward to a more streamlined and accessible process during the period,” she added.

  • PenCom worried over uncredited pension contributions

    PenCom worried over uncredited pension contributions

    • Gives PFAs Dec. 31 deadline to correct anonmalies

    The National Pension Commission (PenCom) has asked employers to get correct the information from their employees, saying improper details from the former is hindering documentation.

      To this end, the commission has given employers till December 31 to do so or face the music.

    PenCom said this action became essential in accelerating the crediting of the withheld pension contributions into the employees’ Retirement Savings Accounts (RSAs). 

    PenCom said it would shed light more on the problem. 

    The Director-General, Mrs Aisha Umar-Dahir stated that the main issue lied in incomplete documentation from employers, resulting in Pension Fund Administrators (PFAs) being unable to credit RSAs of affected employees.

    The DG said: “The Pension Reform Act 2014 (PRA 2014) is a pivotal piece of legislation aimed at safeguarding the retirement future of workers. By virtue of this legislation, employers who employ three or more workers must make pension contributions to their employees’ RSAs, which PFAs expertly manage. The essence is to establish a financial safety net for employees in their golden years, allowing them to enjoy the fruits of their labour without any financial constraints. The PRA 2014 further instructs employers to remit the pension contributions of their employees who have not opened RSAs into nominal RSAs with a PFA designated by the employer.

    Read Also: PenCom publishes employers owing pension contributions on website

    “A nominal RSA is a temporary RSA established for an employee eligible for pension contributions but has not yet chosen a PFA to manage their pension funds. When an employee becomes eligible for pension contributions under the CPS but has not selected a PFA or provided the RSA details to his employer, the employer is still obligated to make contributions on behalf of the employee. As a result, the employer sets up a nominal RSA with a PFA of their choice.

    “The nominal RSA serves as a temporary holding account for the contributions until the employee provides information about their RSA. Once the employee completes the necessary paperwork and selects a PFA, his accumulated contributions from the nominal RSA are transferred to the designated RSA in the selected PFA.

    “However, certain employers have fallen short of meeting their obligations, generating far-reaching consequences. Incomplete documentation and the failure to convert nominal RSAs into personalised RSAs obstruct the smooth and timely crediting of pension contributions, directly impacting the contributors’ benefits.’’

    Mrs. Dahir-Umar said PenCom has published the names of employers and employees affected on its website and that of the PFAs. 

    This transparency not only underscores the gravity of the matter but also showcases PenCom’s commitment to fairness and accountability, she said.

    She, however, called on the affected employers and employees  provide the required information to their PFAs. 

    “We emphasise that this is a rallying cry for employers and employees to embrace responsibility. All hands must be on deck to overcome the challenge of uncredited contributions to achieve the objective of a future of secure retirements, unburdened by financial uncertainties. 

    “As the deadline approaches, PenCom reiterates its commitment to effectively regulating and supervising the pension industry. With collaboration between stakeholders and a steadfast commitment to compliance, the pension landscape can provide a secure foundation for employees’ post-retirement lives,” the DG assured.

  • Coalition debunks allegation against PenCom DG

    Coalition debunks allegation against PenCom DG

    The coalition of Civil Society Organisations coordinated by Africa Media Roundtable Initiative has dismissed documents in circulation purporting that its director-general, Mrs Aisha Dahir-Umar, spent millions of dollars on travel during the COVID-19 pandemic.

    In a statement signed Wednesday, August 30, by Wisdom Ohalete, the coalition said the accusation against the director-general was a figment of the imagination of its promoters.

    They maintained that Dahir-Umar has dwarfed the records of all her predecessors and has gone ahead to raise the country’s pension asset from “N6.42 trillion in 2017 when she came on board to N15.5 trillion as of February 2023.”

    Ohalete noted: “For proper understanding, the management of PenCom under the headship of Mrs Aisha Umar-Dahir was accused of receiving a humongous amount of money in estacode among other issues contained in the petition.

    “According to the allegation as enumerated by the accusers and being amplified by an online newspaper, the amount of money being claimed to have been received by the Director General in estacode is “millions of dollars”. They further put figures to it, which among others include, $1,800,480, N4,965,327, and others.

    “Rattled by the “gravity” of this allegation, we quickly activated our team of Investigators, comprising financial experts, forensic auditors, special fraud examiners, and investigative journalists.

    “This patriotic assignment led our team to dig deep into the allegation, using our vast network to unravel the true state of affairs with the primary aim of making the appropriate recommendation(s) to the relevant institutions of government on the right step to take.

    “However, after the arduous task, the team came to the realisation that the accusations are false, frivolous, unfounded, malicious, and figment of the imagination of the actors whose primary aim we came to understand is to distract the Director General from her giant reformatory drive in the commission. Simply put, the allegations and the documents being bandied were hurriedly cooked up by seekers of favour as a bargaining chip to seek political appointment under the President Bola Tinubu government.

    “While it is not in our position to dissuade people from pursuing their political career, doing so at the crude expense of another man is not only criminal, callous, and ungodly but a demonstration of weakness, lack of dignity, and open exhibition desperation.

    He further stated: “For the avoidance of doubt, it was alleged that the said estacode was received in the year 2020. This again raises a red flag in the entire choreographed episode. You will agree with me that the entire global community was on a total lockdown — no movement of persons within and outside the country. In fact, there was no inter-state travel as a result Covid-19 pandemic which held the global community by the jugular. Despite this, our team meticulously and methodologically deployed their technical know-how and discovered nothing implicating the Director General.

    “Further investigations, however, revealed that what was at play is simply a demonstration of envy, bitterness, powerplay, and unexplained gang-up against the Director General by persons who are afraid that the giant feat she has achieved since assumption of office is displacing the old order, thereby thwarting their efforts to keep the entire sector perpetually backward in a rapidly moving world for their own nefariously selfish intentions.

    “It is one of those scenarios where people fabricate malicious allegations to cheaply blackmail performing heads of government institutions with the primary objective to distract them and instigate their appointor (the President) against them.

    “At the risk of sounding immodest, it is safe to say that the Director General through her sterling performance has dwarfed the records of all her predecessors and has gone ahead to raise the country’s pension asset from N6.42 trillion Naira in 2017 when she came on board to N15.5 trillion Naira as at February 2023.

    “The successful recapitalisation of the pension industry from N1 billion to N5 billion, which she supervised has without any shadow of doubt built the confidence of investors and indeed every stakeholder within the pension value chain.

    “Another first in the nation’s pension industry is the approval of structured reduction of fees on the Net Asset Value of pension fund assets as well as the introduction of the Micro Pension Plan for the participation of informal sector workers in the Contributory Pension Scheme.

    “Among many other brilliant innovations she has introduced is the mortgage scheme for retirement savings account holders, which enables RSA holders to use the balance of their RSA savings for the purpose of mortgage.

    Read Also: PenCom streamlines online enrolment for Fed Govt retirees

    According to him, the DG’s visible reformatory drives led to the approval by the former president of the sum of N159.466 billion for the payment of outstanding accrued rights and other pension liabilities of the government’s retirees. That is an open expression of confidence in the leadership of PenCom under Mrs. Dahir-Umar.

    “It is also laughable that these same accusers have made it their stock-in-trade to attempt to curry favour from any administration that comes on board by fabricating an avalanche of unsubstantiated falsehoods against heads of institutions and parastatals. They did the same under former President Muhammadu Buhari and failed.

    “While we pass a vote of confidence on the Director General of PenCom, we appeal to all stakeholders to ignore the unfounded allegations against her and continue to offer support as she is poised to give all Nigerians a life worth living post-retirement.

    “We call on President Bola Tinubu to sustain the federal government’s support towards the total overhaul of the country’s pension sector for a collective success in the interest of our senior citizens and all other members of our society.”

  • PenCom publishes employers owing pension contributions on website

    PenCom publishes employers owing pension contributions on website

    • Threatens regulatory action against employers

    The National Pension Commission (PenCom) yesterday said it had published names of employers with employers remitting the pension contributions of their employees with incomplete documentation, a development that has made it impossible for Pension Fund Administrators (PFAs) to credit the pension account of the affected employees.

    The commission in a statement threatened to take appropriate regulatory actions against employers who fail to correct the anomaly by December 31, in line with the provisions of the PRA 2014.

    The statement entitled: “Outstanding Pension Contributions in the Account of Pension Fund Administrators (PFAs)”

    Read Also: CJN earns more than VP, Sen. President, says RMAFC

    It read: “The Pension Reform Act 2014 (PRA 2014) mandates employers with three or more employees to remit pension contributions into the Retirement Savings Accounts (RSAs) of their employees with Pension Fund Administrators (PFAs). The PRA 2014 further mandates employers to remit the pension contributions of their employees who are yet to open RSAs into nominal RSAs with any PFA chosen at the employers’ discretion.

    “PenCom has observed that some employers are remitting the pension contributions of their employees with incomplete documentation. Consequently, PFAs have been unable to credit the RSAs of the affected employees.’’

    “The list of the affected employers and employees can be viewed on the websites of PenCom and PFAs. All employers and employees on the aforementioned list are required to provide the PFAs with the requisite information to facilitate the crediting of pension contributions into the employees’ RSAs.

    “Please note that the Commission shall take appropriate regulatory actions against employers who fail to comply with this directive by 31 December 2023, in line with the provisions of the PRA 2014.

    “RSA holders and the general public are assured of PenCom’s commitment to effectively regulating and supervising the pension industry, to ensure that retirement benefits are paid as and when due”, the release showed.

  • PenCom streamlines online enrolment for Fed Govt retirees

    PenCom streamlines online enrolment for Fed Govt retirees

    AS the landscape of pension fund administration evolves with the rapid advancement of technology, the National Pension Commission (PenCom) has taken a proactive step towards modernising and simplifying the pension verification and enrolment process for prospective retirees of Federal Government Treasury Funded Ministries, Departments, and Agencies (MDAs).

    The commission issued the revised guidance note to Pension Fund Administrators (PFAs) on online enrolment, marking a significant stride in embracing digital transformation and ensuring a seamless transition into retirement for government employees.

    Speaking on the key highlights of the revised guidance note and its potential to revolutionise pension administration, PenCom spokesman, Abdulqadir Dahiru said the core of this initiative is the development of an Online Enrolment Application.

    Online Enrolment Application

    He said: “The core of this initiative is the development of an Online Enrolment Application hosted on the PenCom website http://www.pencom.gov.ng, which empowers prospective retirees with the tools to complete their enrolment process from the comfort of their homes.This innovative application comprises four distinctive modules, each contributing to the holistic pension enrolment process: Retiree Registration, PFA Module, MDA Module, and PenCom Module.

    “Using the Retiree Registration Module, prospective retirees can register, scan, and upload all necessary documents, ensuring the accuracy and completeness of their pension information. The Enrolment Application streamlines the verification and enrolment stages by reducing manual paperwork and the possibility of multiple RSA PINs. PFAs play a crucial role in this process through the PFA Module. Significantly, PFAs verify and enrol prospective retirees, ensuring the accuracy and consistency of the submitted information. PFAs also guide individuals through the online registration process when needed.

    “Similarly, the MDA Module allows Pension Desk Officers of MDAs to upload relevant information about prospective retirees, fostering transparency and collaboration between government entities and the Licensed Pension Fund Operators (LPFOS). Finally, the PenCom Module validates the records submitted by all parties, ensuring the accuracy and integrity of the pension data. This step adds an extra layer of scrutiny to prevent errors or fraudulent activities.”

    Efficiency and transparency

    According to the DG, the digital approach brings many benefits, paramount among them being efficiency and transparency. By streamlining the enrolment process, prospective retirees can complete their registration and document submission at their convenience, minimising the need for physical visits and reducing bureaucratic bottlenecks.The automation’s outcome is a smoother retirement transition and timely budgetary provision by the Federal Government for accrued pension liabilities.

    Legal framework and oversight

    “The revised guidance note is anchored in the legal framework provided by the Pension Reform Act (PRA) of 2014. Section 15 of the PRA 2014 mandates the recognition of accrued pension entitlements, while Section 39 establishes the Federal Government Retirement Bond Redemption Fund (RBBRF) and PenCom’s role in assessing its adequacy against projected pension liabilities. The online enrolment system aligns with these provisions, ensuring compliance and enhancing accountability.

    Verification and document retention

    “Enrolment officers are mandated to counter sign the enrolment slips, thereby confirming the sighting and verification of original documents, thus ensuring the accuracy and completeness of the records.

    “The revised guidelines outline detailed procedures for document retention, with an emphasis on security, organisation, and ease of retrieval. PFAs are required to keep copies of the signed Enrolment Slip and other relevant documents.”

    Step-by-Step procedures for Online Enrolment

    Dahiru further stated that the online enrolment is divided into three stages. They include Registration, Verification, and Enrolment.

    He said prospective retirees could either complete self-assisted registration or seek assistance from PFAs. Self-assisted registration involves visiting the PenCom’s website, creating an account, and providing required information such as RSA PIN, NIN, personal details, and employment history. Scanned copies of the documents are uploaded to the system, ensuring data accuracy.

    On the other hand, he noted that PFAs

    play a pivotal role in the verification stage. They crosscheck the information provided, ensuring alignment with the original or certified true copies of the required documents. PFAs also guarantee the completeness and accuracy of employment records, salary details, and relevant supporting documents.

    “A live image/photograph of the prospective retiree is captured through the application, and two copies of the Enrolment Slip are printed for signature. The retiree retains one copy of the Enrolment Slip while the other is submitted to the PFA.’’

    Sick/Incapacitated prospective retirees

    “The revised guidance note considers the challenges sick or incapacitated prospective retirees face. In such cases, a Next-of-Kin (NOK) can register on their behalf, uploading required documents and medical reports. The PFA conducts remote verification and enrolment, ensuring that the enrolment process is accessible to all, regardless of their physical condition.

    List of enrolled prospective retirees

    “Under the revised Enrolment Guidance Note, PFAs are required to forward the list of enrolled prospective retirees to PenCom on a monthly basis. This shift is designed to ensure efficient communication and prompt submission of enrolment data,” he said.

    He added that the Revised Guidance Note is a remarkable leap forward in pension administration. 

    By embracing technology, streamlining processes, and ensuring transparency, he said PenCom is simplifying the transition into retirement for government employees and setting a precedent for modern and efficient pension fund management.

  • PenCom fines defaulting employers N7.79b

    The National Pension Commission (PenCom) has collected N7.79 billion from employers that defaulted in remitting pension contribtutions deducted from their employees’ Retirement Savings Account (RSAs).

    The cash which is the total recoveries made from inception of the Contributory Pension Scheme (CPS)  to date, represents two per cent interest of the amount deducted and not remitted by the employers as and when due.

    Accordingly, total recoveries made from inception to date amounted to N16.01 billion, comprising principal contributions of N8.22 billion and penalty N7.79 billion.

    The cash, according to a PenCom report titled: Second Quarter 2019: Update on the Recovery of Outstanding Pension Contributions and Interest Penalty from Defaulting Employers, has since been credited to the respective pension accounts (Retirement Savings Accounts) of the affected employees.

    The Pension Reform Act (PRA) 2004 as repealed by the PRA 2014 states that an employer is under obligation to remit pension contributions to pension fund custodians within seven days after payment of salaries.

    Otherwise, in addition to making the remittance, the employer shall be liable to a penalty which shall not be less than two per cent of the total contributions that remain unpaid for each month or part of each month that the default continues. According to PenCom, 37 employers paid N110 million penalty in the second quarter (Q2) of this year.

    “The Commission maintained the services of Recovery Agents (RAs) for the recovery of outstanding pension contributions and penalty from defaulting employers. The RAs were mandated to review the pension records of the employers assigned by the Commission with a view to recovering outstanding pension contributions with penalty. During the quarter, demand notices were issued to 37 defaulting employers whose pension liabilities had been established by the RAs, which resulted in the remittance of outstanding pension contributions of N260.62 million, representing principal contributions of N151.59 million and penalty of N109.64 million.”

    The Commission said it embarked on public awareness for the organised private sector in collaboration with Ministries, Departments and Agencies (MDAs).

    “Further to the Commission’s strategy of driving compliance with the provisions of the PRA 2014 by employers through the conduct of public awareness programmes, the Commission has continued to organise sensitisation workshops on the CPS for employers’ associations/unions to enlighten and encourage them to key into the Scheme.

    “The Commission in collaboration with the Nigeria Employers’ Consultative Association (NECA) conducted an interactive session on the current developments and challenges in the implementation of the Pension Reform Act 2014 for the organised private sector in Lagos, Port Harcourt, Abuja and Kano,” the report added.

  • Financial Inclusion: NAICOM, PenCom move to capture 36.6m Nigerians

    Following plans to meet its financial inclusion target, the Federal Government has restated the desire to capture over 36.6 million Nigerian adults, representing 36.8 per cent of the working population through the micro segment of insurance and pension sectors.

    The figure includes self-employed Nigerians that are yet to officially embrace any form of financial services product.

    Speaking at the 4th National Insurance and Pension Correspondents (NAIPCO) National Conference in Lagos State, stakeholders in both sectors said majority of Nigerians in the informal sector were yet to be aware of the numerous benefits in embracing financial services products.

    To ensure that every Nigerian have access to financial services, they said the Federal Government came up with micro insurance and micro pension products to penetrate the grassroots and also get to those not currently registered in the Contributory Pension Scheme [CPS] nor covered by any form of insurance.

    To achieve the agenda, the Acting Director General, National Pension Commission (PenCom), Mrs Aisha Dahir-Umar, said the commission planned extending pension coverage to 30 million contributors by 2024, thereby ensuring that 40 per cent adult Nigerians are covered under the CPS.

    Dahir-Umar, who was represented by the Head, Benefit Administration Unit, PenCom, Babatunde Philips, said President Mohammadu Buhari, in March, 2019, launched the micro pension scheme to provide the informal sector with a veritable means of securing old age income.

    She said implementation of the Micro Pension Plan (MPP) would yield positive results for Nigerians and the pension industry, adding that it would assist greatly in reduction of old age poverty in the country.

    According to her, “the commission has put in place requisite infrastructure to facilitate seamless implementation of MPP. The Enhanced Contribution Registration System (ECRS) has been deployed to facilitate seamless operations of the MPP. This system has so far aided the smooth registration of micro pension contributors.”

    She also applauded the media for consistent support, saying it had assisted the commission in recording modest achievements in educating and enlightening the public on the workings of the CPS and the commission’s activities.

    Speaking in the same vein, the Acting Commissioner for Insurance, Mr Sunday Thomas, said the National Insurance Commission (NAICOM) had been doing a lot in terms of financial inclusion in the past eight years.

    The acting commissioner, who was represented by the Director, Governance Enforcement and Compliance, Leo Aka, said it required collective efforts to ensure that Nigerians in the informal sector embrace financial services.

    Looking at the demography of Nigeria, Thomas said one would notice that unemployment rate in Nigeria was quite high, adding that this was a signal that the industry needs to move fast to capture the people in the informal sector.

    He said the insurance commission had issued some guidelines to ensure that those not in the formal sector embrace financial services.

    Thomas added that while establishing the micro insurance guidelines, the commission ensured that the micro insurance products are very simple, easy to understand, affordable, valuable in that it should be able to address needs and remain efficient.

  • PenCom inspects Edo pension board, bureaux, others

    The National Pension Commission has conducted the maiden inspection of the pension arrangements in Edo State and its agencies.

    The inspection, according to the commission, was aimed at ascertaining the level of implementation of the CPS as well as the administration of the Defined Benefits Scheme (DBS) in the state.

    The commission in its First Quarter 2019 Summary Report, stated that they also conducted an inspection of the Pension Fund Administrator (PFA) branches operating in Edo State.

    The report read: “The inspection was to determine the extent to which staff of the PFAs were conversant with the provisions of the Edo State Contributory Pension Law and extant regulations and guidelines issued by the Commission, the level of compliance of the PFAs with the Commission’s circular on minimum requirement for opening of branches and service centers as well as the quality of services rendered to stakeholders.

    “The Commission further conducted routine inspections of the Federal Capital Territory (FCT) Pension Board and the FCT Area Council Staff Pension Board. The purpose of the inspections was to ascertain the level of implementation of the CPS as well as the administration of the DBS in the FCT and Area Councils.”

    Giving update on engagements with the state governments on the implementation of the Contributory Pension Scheme (CPS), the commission said it continued its engagement with state governments on the implementation of the CPS.

    “The Commission held series of meetings with the management and staff of Ondo State Pension Commission (OSPEC), the Committee on the Implementation of the CPS in Ondo State, the Management and Staff of the Ondo State Oil Producing Area Development Commission (OSOPADEC) as well as officials of the Ondo State Local Government Service Commission.

    “The meeting was convened to discuss some of the challenges in the implementation of the CPS in the state. The issues discussed include, provision of Information and Communications Technology infrastructure especially the deployment of appropriate applications by OSPEC, provision of Group Life Insurance Policy, capacity building for staff, non-conduct of a actuarial valuation to determine the past service liabilities of the employees, non-creation and funding of the Retirement Benefits Bond Redemption Fund (RBBRF) Account, irregular deduction and remittance of pension contributions for employees of the state.

    “The commission also held a meeting with the Technical Committee on Pension, Kano State. The meeting was convened to address the issue of non-remittance of pension contributions and inability of Kano State Pension Fund Trustees to pay retirement benefits as at when due.

    “In the same vein, the commission conducted the First Quarter 2019 Consultative Forum for states and the FCT.  The event was attended by representatives of all states and the FCT, States and Local Governments Pension Bureau, Compliance Officers of Pension Fund Administrators (PFAs) and Pension Fund Custodian, (PFCs).”

    The Acting Director-General, PenCom, Mrs Aisha Dahir-Umar, explained that the commission’s principal aim is to monitor the status of implementation of the CPS in the states and local governments.

    She said that by so doing, they will be able to help the states in areas that they consider as challenging.

    She stressed that some states have issues and challenges that they are trying to overcome to be able to join the scheme but they are working to help hasten the implementation of the CPS in the various states.