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CPS: ‘RSA holders accessed N291.7b benefits in first-half’

ABOUT 50,125 Retirement Savings Account (RSA) holders under the Contributory Pension Scheme (CPS) have accessed N291.7 billion pension benefits in the first half of the year.

PenCom said this in a statement obtained by The Nation.

For about 20 years, accessing retirement and terminal benefits within the CPS has been regulated by the Commission.

However, PenCom has established the requirements for RSA holders to access their benefits promptly.

Suffice to state that Section 7(1) of the Pension Reform Act (PRA 2014) provides that RSA holders are entitled to access their benefits upon retirement or upon reaching 50.

To this end, contributors also have the option to withdraw a lump sum from their balance, provided that the balance is adequate to secure either a Programmed Withdrawal (PW) or a Retiree Life Annuity (RLA) for pension.

Under the CPS, the PW offers a regular pension payment through a Pension Fund Administrator (PFA), while the RLA, purchased from a Life Insurance Company, provides a steady income for life.

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Aside from retirement, the CPS also offers other payments, which include provisions for Temporary Job Loss, Death benefits, En bloc payments and Equity Contribution for Residential Mortgage, among others.

Programmed Withdrawal

Programmed withdrawal is a benefit payment method by which the employee collects his retirement benefits in periodic sums (monthly or quarterly) spread throughout an estimated life span. From January to June, this year, PenCom has approved 13,581 requests from retirees to draw pension through PW mode. The retirees received a total lump sum of N74.88 billion, while their monthly pensions amounted to N871.02 million.

Retiree Life Annuity

RLA, on the other hand, is a contract for regular income purchased from an approved Life Insurance Company, which provides monthly or quarterly income to retirees during their lifetime. From January to June 2024, 9,560 retirees choose the annuity mode of pension payment. A lump sum of N35.21 billion was approved for payment to the retirees. N52.71 billion was paid to RLA providers to pay a monthly pension of N885.22 million to the retirees.

En-bloc Payment

The Revised Regulation for the Administration of Retirement and Terminal Benefits allows en-bloc payment to retirees whose RSA balances cannot procure Programmed Withdrawal or RLA that is equivalent to one-third of the prevailing national minimum wage. From January to June 2024, PenCom approved the en-bloc payment of retirement benefits to 7,167 retirees, totaling N4.85 billion.

Death Benefits

Death Benefits are paid to a beneficiary under a will or the spouse and children of an RSA holder who dies in service. In the absence of a wife and child, the benefits are paid to the recorded next-of-kin or any person designated by the deceased. From January to June 2024, PenCom granted approvals for payment of death benefits amounting to N64.29 billion to the legal beneficiaries/administrator of 7,813 deceased employees and retirees.

Temporary Job Loss

The PRA 2014 permits an employee who loses his job to withdraw an amount not exceeding 25 per cent of the total amount credited to his RSA. However, such withdrawals can only be made after four months of cessation of employment, and the employee does not secure another job. Between January and June, this year, PenCom approved N23.47 billion to 14,179 RSA holders who were less than 50 and were disengaged from employment and could not secure another job within the stipulated four months.

Voluntary Contributions

Section 4(3) of the PRA, 2014 allows RSA holders to make Voluntary Contributions (VC) in addition to the mandatory contributions to augment their pension at retirement. The VC can be withdrawn periodically based on the guidelines. From January to June 2024, PenCom approved withdrawals from voluntary contributions amounting to N7.33 billion by 2,099 contributors.

Equity Contribution for Residential Mortgage

Eligible RSA holders have the opportunity to utilise their RSA balance to pay equity contributions for residential mortgages, in accordance with Section 89(2) of the PRA 2014. This provision enables RSA holders to allocate a portion of their pension savings towards the equity component of a residential mortgage.

This initiative has proven instrumental in helping numerous individuals achieve their aspirations of homeownership since its inception. In the first six months of the year, PenCom disbursed N28.52 billion to 3,539 RSA holders, facilitating their equity contributions for residential mortgages.

In conclusion, accessing retirement benefits under the CPS is seamless. PFAs must guide RSA holders who want to access their retirement benefits on the documentation requirements for each benefit payment type.

July 31, 2024
Data Recapture: Regulator urges RSA holders to update records

The National Pension Commission (PenCom) has directed that retirement savings account (RSA) holders enrolled in the Contributory Pension Scheme (CPS) on or before July 1, 2019, must participate in the Data Recapture Exercise (DRE).

The exercise, which covers active and retired RSA holders, began in August 2019.

The commission made this known in a statement obtained by The Nation.

The Director-General, PenCom, Mrs. Aisha Dahir-Umar, said that not participating in the DRE has significant implications for accessing pension services from Pension Fund Administrators (PFAs).

For instance, she said only RSA holders who have completed their data recapture can transfer their RSAs from one Pension Fund Administrator (PFA) to another.

Contributors who have not undergone recapture, according to her, will not be able to access retirement benefits upon retirement.

Moreover, temporary access to 25 per cent of the RSA balance in cases of job loss and access to pension savings for procurement of residential mortgages are exclusively available to RSA holders who have completed data recapture, she added.

She stated that RSA holders with multiple Personal Identification Numbers (PINs) who fail to recapture their data will experience delays in resolving their situations, potentially resulting in incorrect remittances by employers and delays in the payment of retirement benefits. Consequently, contributors with multiple RSA PINs must present all their RSA PINs during the data recapture process.

She said: “It is crucial to note that failure to participate in the DRE affects RSA holders’ ability to update registration records in the future. For example, changes in name due to marriage, changes of employer, or alterations to the Next of Kin (NOK) information cannot be made if data recapture is not completed. Hence, it is in the best interest of RSA holders to participate in the DRE to avoid unnecessary delays in accessing services from PFAs. PenCom has instructed all PFAs to issue acknowledgement slips to RSA holders who submit complete documentation for their data recapture. RSA holders will receive text messages within five working days, notifying them of the status of their data recapture (whether successful or not) after document submission.

“Active contributors must visit their PFAs and provide their Staff Identity Card or any valid means of identification, such as a National Driver’s Licence, Permanent Voter’s Card, or International Passport. Additionally, they should present their Enrolment Slip issued by NIMC and Birth Certificate or Sworn Affidavit of Age Declaration for the DRE. Retirees under programmed withdrawal or annuity should provide any valid means of identification, the Enrolment Slip issued by NIMC, and the Letter of Retirement issued by their employer for the DRE.

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“For RSA holders who have changed their surnames or first names, or both, after registration, the following documents must be presented to their PFA for recapture: Marriage Certificate (if applicable), Newspaper publication for the change of name, and Sworn Affidavit and Confirmation Letter for change of name from the employer (if still employed)”.

Mrs. Dahiru-Umar further said that the commission remains committed to the effective regulation and supervision of the pension industry to ensure that retirement benefits are paid as and when due.

“The necessity for the DRE arose from the vital requirement to collect and maintain current, comprehensive, and accurate data of RSA holders. Additionally, the DRE aligns with the Federal Government’s directive for all data-generating organisations to harmonise their databases with the National Identity Management Commission (NIMC).

“To facilitate the DRE, PenCom introduced the Enhanced Contributor Registration System (ECRS). The ECRS is designed to verify the uniqueness of individuals registering under the CPS and update existing RSA holders’ records. The ECRS is seamlessly integrated with the NIMC.

“It is mandatory for RSA holders in the public and private sectors, as well as retirees, to participate in the data recapture exercise to update their personal information, including biometric data such as photos and signatures”, she noted.

November 15, 2023
RSA not savings account, says PENCOM

Retirement Savings’ Accounts (RSAs) cannot be designated as bank accounts, the National Pension Commission (PENCOM), has said.

PENCOM made the clarification in reaction to claims by the Rivers State Council of the Trade Union Congress of Nigeria (TUC) which had threatened to embark on industrial action should the Commission implement the yet to be released “Guidelines on Unilateral Withdrawals from Voluntary Contribution from Retirement Savings Accounts (RSAs) by Contributors.”

In a statement signed by its Head of Communications, PENCOM, said “there are indications that some Contributors may be confusing RSAs to be the same as Bank Accounts. RSAs are not the same as Bank Accounts, so PenCom needs to discourage this practice.”

He said that Voluntary Contributions into RSAs, “are meant to boost Contributors’ final pension and not a savings account that could be drawn at will.”

The Guidelines, Onuora added, “will boost Government’s Fight Against Financial Terrorism and Money Laundering, and nip in the bud the dangers that could arise should Contributors decide to use RSAs to launder dirty money.”

Onuora said the Guidelines remain a Draft, but stated that “the Commission will expose it to stakeholders for their input in due course.”

He urged the TUC, Rivers State Council to harmonise its position on the issue and make useful input into the Guidelines, saying since the TUC is represented on the Board of PenCom, the workers could use this channel to address their grievances.

The Rivers State Council of the Trade Union Congress had noted that the guidelines still in the making, provided that: “any person making Voluntary Contributions to his/her RSA in addition to the statutory contributions made by him and his employer, may withdraw up to 20% of the balance standing in the Voluntary Contributions portion of the RSA, not more than once in every four years.”

November 23, 2015
CPS: Workers to access mortgage with 25% RSA balance

Are you a contributor under the Contributory Pension Scheme (CPS) and a retirement Savings Account (RSA) holder?

If your answer is yes, then you may soon be able to access up to 25 per cent of your RSA balance and utilise as equity contribution for a residential mortgage loan.

Twenthy-five per cent of your RSA balance will enable you to access a mortgage loan of between N1.5 million and N50 million.

This was contained in the draft guidelines on withdrawals from Retirement Savings Account (RSA) towards Equity Contribution for Payment of Residential Mortgage released to the public by the National Pension Commission (PenCom).

Section 89 (2) of the Pension Reform Act (PRA) 2014 provides that a Pension Fund Administrator (PFA) may, subject to guidelines issued by the Commission, apply a percentage of pension fund assets in the retirement savings account towards payment of equity contribution for payment of residential mortgage by a holder of Retirement Savings Account (RSA).

Pursuant to the referenced Section 89(2), these guidelines provide the framework for its implementation. It seek to provide the operational modalities for PFAs in determining the eligibility requirements, procedures and documentation required to enable RSA contributors to access and utilize part of their RSA balances towards equity contribution in respect of first home ownership mortgages.

Meanwhile, a RSA holder shall access a portion of the RSA balance as equity contribution for residential mortgage, only once in a lifetime and may not be entitled to a lump sum payment at retirement.

The guideline however favors insurance operators as it requires that the property to be purchased by a RSA shall have comprehensive insurance policy in the name of the borrower, to cover the replacement or reinstatement cost of the property. The insurance policy must note the RSA Fund as one of the first loss payees, to cover the equity contribution released by the PFA.

The general principles in the guideline to access RSA Balance reads: “All applications by RSA holders to access and utilise a percentage of their RSA balances as equity contribution for mortgage loans shall be approved by the Commission.

“A RSA holder shall access a portion of the RSA balance as equity contribution for residential mortgage, only once in a lifetime. He or she shall make a formal application to the PFA requesting for a portion of the RSA balance as equity contribution for a mortgage loan.

“A RSA holder that has utilized a portion of the RSA balance as equity contribution for residential mortgage may not be entitled to a lump sum payment at retirement. An eligible RSA holder shall be allowed to access a maximum of 25 per cent of the RSA balance as equity contribution for a mortgage loan.

“The RSA balance shall be the Value of an Accounting Unit of the Fund (VAUF) of the RSA Fund multiplied by the accounting units held by the RSA holder as at the date the application was received.”

The guideline further reads that in order to qualify to access the RSA balance as equity contribution for a mortgage loan, the RSA holder must be in active employment, either as a salaried employee or self-employed person.

He or she must have been contributing consistently for a minimum of 10 years, prior to the application for drawdown.

“The RSA holder’s Debt to Income ratio shall not exceed 33.33 per cent of his or her net monthly income at the time of applying for the mortgage. The RSA holder’s debt shall be the sum of the monthly mortgage repayments and other personal debt obligations that impact on his monthly income.

“The RSA holder shall provide the required documentation as required under Section 5.0 and, or other additional documentation requested, from time to time.

The guideline also read: “An eligible RSA holder shall use the proceeds of the mortgage loan to purchase either a single-family home or an apartment in a multi-unit building, which must be owner-occupied. The title to the property must have a fully perfected title and free from any encumbrance.

“The property shall have comprehensive insurance policy in the name of the borrower, to cover the replacement or reinstatement cost of the property. The insurance policy must note the RSA Fund as one of the first loss payees, to cover the equity contribution released by the PFA.

“The valuation of the property to be purchased with the mortgage loan shall be carried out by a licensed, independent valuer who is a member in good standing with the Nigerian Institution of Estate Surveyors & Valuers (NIESV) and must carry Professional Indemnity Insurance with an insurance company licensed and in good standing with National Insurance Commission (NAICOM).

“The mortgage loan amount shall be a minimum of N1.5Million and a maximum of N50Million and the tenor shall be for a minimum of five years and a maximum of 20 years.”

September 2, 2015
NLPC records 14.35% returns on RSA investment

NLPC Pension Fund Administrator, a pension fund administrator has generated 14.35 per cent returns on the investment in Retirement Savings Account (RSA) pension funds in 2013 financial year.

The PFA recorded gross earnings of N1.6 billion in the year under review, a 30 per cent increase from the N1.23billion recorded in 2012.

Total fund under the management also grew from N59.5billion in 2012 to N79.15billion in 2013. The company however, recorded a profit after tax of N388.58 million in 2013 from N294.1 million in 2012, a 32 per cent increase.

The Managing Director, NLPC, Wale Kolawolewho disclosed this during the firm’s ninth annual general meeting in Lagos, said the company will continue to render qualitative services to its numerous account holders and retirees so as to ensure that their life after retirement is full of happiness with sound mind.

The Chairman of the company, Olabode Emmanuel, said earnings per share also increased from 20.14k in 2012 to 25.9k in 2013.

He said: “Shareholders funds increased from N1.2billion in 2012 to N1.6billion in 2013 and global fund has continued to grow.

“Despite stiff competition and a challenging economic climate, the firm had continued to forge ahead, which confirms the ability of the management to steer the company on profitable course. The emergence of the world economy from global recession and the impressive growth rate of the Nigerian economy is expected to impact positively on output and employment in 2014.”

Emmanuel saidthis is expected to lead to increase in contributions and remittances as well as reduction in the rate of untimely retirements and claim.

All things being equal, we expect more funds under the management and increase in earnings and improved profitability in the years ahead, he said.

June 18, 2014
PenOp begins campaign on workers’ right to RSA

The Pension Fund Operators Association of Nigeria (PenOp), has kicked off a campaign programme to boost employers and employees awareness on the need to open Retirement Savings Account (RSA).

The campaign, which commenced with a rally at the May Day celebration at Onikan Stadium, Lagos, was a follow up to seminars and interactive sessions held with employers and employees.

The Secretary, PenOp, Susan Oranye, who made this known, said the theme for the campaign, ‘Every worker deserves an RSA,’ was instructive and urged workers to leverage on the Contributory Pension Scheme (CPS) to secure their future.

She said the National Pension Commission (PenCom) and pension operators, are working hard to tackle the problem of non-remittance of monthly pensions by employers.

She stressed that the Contributory Pension Scheme remains one of the best things to have happened in country in recent years, adding that the scheme has instilled blighter future for workers.

She noted that the scheme was introduced to eradicate the ugly sights where workers queue, cry and beg for their pension, stressing that the new scheme is transparent, fully funded, safe and should be embraced by very worker.

She said: “PenOp is here to honour and support Nigerian workers, which is what the workers’ day is all about. The underlying concern for all pension fund administrators is for the workers, to prepare them for when they would not be able to work again.

“Workers are indeed working hard, but they should also understand that after work, they still have bills to pay and how to pay these bills should be planned now that they are in active service. We are calling on workers who are yet to embrace the contributory pension scheme to do so now.”

She said the pension industry has done exceedingly well, given the level of awareness, adding that since the scheme started, about N24 .6 billion has been paid to over 84,000 retirees.

“This is a new dispensation; it is not like the old scheme where people line up, cry and beg for their money. The new scheme is really working and focused on workers. It is transparent, fully funded and safe. Hence, every worker should embrace it, as it provides decent living for retirees,” she said.

“We have been educating them on the need to understand that the funds are for their employees and that they should also consider the system as a corporate social responsibility which helps in boosting the morale of workers.

“When employers provide secured future for their employees through pension, they will be happy to give their best, which will raise the bottom-line of the employer. This is why all employers of labour, both in public and private sector must support their staff to open an RSA with any PFA of their choice so they can benefit when they retire”. She said the industry has come up with names of defaulters and is working on their level of compliance.

Head, Risk and Compliance, Stanbic IBTC Pension Managers, Idu Okwuosa, said the event provided an opportunity for PenOp to let workers know how important it is to have a retirement savings account.

She added that as at February, the pension assets stood at about N4 trillion from about 5.9 million contributors from the 20 Pension Fund Administrators (PFAs) operating in Nigeria.

She said: “The pension asset under the contributory scheme is projected to peak at about N4.3 trillion by end of December 2014 from projected 6.2 million contributors.The growth rate of industry contributions nationwide is about $2 billion annually which is over N300 billion apart from market returns.

Under the contributory pension scheme, employers deduct 7.5 per cent of individual workers monthly salary and contribute at least the same amount which is credited into the workers’ Retirement Savings Account in any of the PFAs chosen by individual workers. The PFA manages the accumulated funds, which is under the custody of the PFC chosen by the PFA, she noted.

May 7, 2014
Family, others seek Jonathan’s help on missing OAU lecturer

•Professor of Nuclear Physics last seen in Akwa Ibom

Authorities of the Obafemi Awolowo University (OAU), Ile-Ife, Osun State; family and students of 65-year-old Professor of Nuclear and Medical Physics, James Bolarinwa Olomo, have urged the Federal Government to assist in the search for the professor.

They also sought the assistance of the Akwa Ibom State government, State Security Service (SSS), police and other Nigerians.

Prof Olomo has reportedly been missing for over 80 days.

He is also a radiation safety adviser (RSA) to the Oil and Gas sector.

Addressing reporters yesterday at the International Press Centre (IPC), Ogba, Lagos, OAU’s spokesman Prof Akinola Adegbola said there had been no information on Prof Olomo since he went missing nearly three months ago.

Adegbola, who is also the chairman of the university’s branch of the Academic Staff Union of Universities (ASUU), said the university community, students, family and others were traumatised by the professor’s disappearance.

He said: “Prof James Bolarinwa Olomo, a professor of Nuclear and Medical Physics at the Obafemi Awolowo University (OAU), Ile-Ife, went to Eket in Akwa Ibom State as a radiation safety adviser (RSA) to an oil and gas company on Thursday, October 17, 2013, and was last heard from on Saturday, October 19, 2013.

“He left Lagos on Thursday, October 17, 2013, by flight to Calabar (Cross River State) and to Eket by road via Uyo (both in Akwa Ibom State). He lodged at Hotel Farlem, 8 Archibong Street, Afaha Ukwa, Eket, and spent three nights there. He planned to return to his home in Ibadan (Oyo State) on Monday, October 21, 2013. He was last reached on his phone by a colleague from Ile-Ife about 9pm on Saturday, October 19, 2013. Their conversation lasted over 40 minutes.

“His secretary, who also spoke with him about 8pm on Saturday, October 19, 2013, told his colleagues and family on Monday, October 21, 2013, that Prof Olomo had not returned from Eket and could not be reached on his phone since Sunday, October 20, 2013. Since then, there have been efforts to contact him. We are yet to make a breakthrough.”

The spokesman said several efforts, including a journey to Akwa Ibom by a search party, comprising members of the OAU-ASUU and Otan Ayegbaju community in the university, were made to trace or contact the professor.

According to him, the team was received and taken round Uyo and Eket by officials of the University of Uyo branch of ASUU, led by its Chairman, Dr. Anyim Anyim.

The OAU-ASUU Search Committee Chairman, Prof Olugbenga Jegede, said: “The matter has been reported to the police and SSS in Osun and Akwa-Ibom states. There has been no clue concerning his whereabouts.

“Major hospitals in Eket have been contacted and there is no case of any accident linked to Olomo.

“The police, his colleagues from OAU and family have visited Hotel Farlem, Eket. His bag containing a native dress, a towel, a sponge and three tellers were found in his hotel room. The hotel manager and the attendants said he submitted his room key, left early in the morning of Sunday, October 20, 2013, without checking out or returning.

“His bag was packed into a store and his room re-allocated to another guest. The hotel workers did not report his disappearance to the police, arguing that they had similar experiences when guests would go out and return few days or weeks later and apologise that they travelled or were busy working on the field.”

Adegbola sought the assistance of President Goodluck Jonathan, Governors Rauf Aregbesola (Osun); Godswill Akpabio (Akwa Ibom); Inspector-General of Police (IGP), Assistant Inspector-General of Police (AIG), South-south, police commissioners of Akwa Ibom and Osun states, director of State Security Service (SSS) and his officers in Akwa Ibom and Osun states, Divisional Police Officer (DPO) in Eket, Mr. Sunday Digah, to locate Olomo.

He also sought the help of Oba Okunade Sijuade, the Ooni of Ile-Ife; Edidem Ekpo Okon Abasi, the Obong of Calabar and the paramount ruler of Eket, Dr. Timtiniko Enodien.

The lecturer said the disappearance of the professor was a mystery and shock.

According to him, the incident has dealt a deadly blow to his colleagues, students, friends and relations.

Adegbola said anyone with information on Prof Olomo contact the following people: OAU’s Vice-Chancellor, Prof Bamitale Omole; the Chairman, OAU-ASUU, Ile-Ife, Prof A. P. Akinola – 08056712159; the Chairman, Search Committee, OAU, Ile-Ife, Prof O. O. Jegede – 08034007146; the Chairman Otan Aiyegbaju Progressive Union (OAPU), OAU branch, Ile-Ife, Prof A. J. Farinde – 08033618883 and representative of Olomo Family, Mr. Segun Olomo – 08033580020.

January 8, 2014
OAU Prof yet to be found

As universities across the nation get set to reopen after the five-month-old face-off between the Academic Staff Union of Universities (ASUU) and the Federal Government, Prof James Bolarinwa Olomo may not return to work with his colleagues at the Obafemi Awolowo University (OAU), Ile-Ife, Osun State.

For over two months now, his whereabouts have been a cause for concern for his colleagues, family and indeed, the university’s authorities.

They have remained persistent in their appeal to the public to provide any information that could lead to his recovery.

Olomo, a Professor of Nuclear and Medical Physics at the OAU, was said to have left Lagos on Thursday, October 17 by flight for Calabar and later, by road for Eket near Uyo, the Akwa Ibom State capital, supposedly to an oil & gas company, where he is a Radiation Safety Adviser (RSA).

A statement jointly signed by the school’s chapter of ASUU, Search Committee (Department of Physics); OAU Administration, Otan Aiyegbaju Progressive Union; and the Olomo family, said Olomo was last reached on phone by a colleague from the institution and his secretary on October 19.

The statement said the matter had since been reported to the police, State Security Service (SSS), Osun and Kwara states government, and major hospitals in Eket, among others.

The statement urged any Nigerian with useful information to contact OAU’s Vice-Chancellor, Prof Bamitale Omole, or representatives of the Olomo family on 08033580020.

The statement added: “A Yoruba adage says: ‘The demise of a child is more tolerated than his or her disappearance.’ The disappearance of Prof James Bolarinwa Olomo is still a mystery and shock and has dealt a deadly blow to his colleagues, students, friends and relations.

“The search must continue until he is found and therefore, we need to double our efforts. It is exactly two months and one week now since he disappeared mysteriously.”

January 1, 2014