By Victor Ahiuma-Young
President Goodluck Jonathan has assured workers and retirees, especially participants in the Contributory Pension Scheme, CPS, that protection of pension assets for the payment of retirement benefits, as and when due, is paramount to his government.
The President also explained that his government has restructured the administration of the defunct Defined Benefits Scheme, DBS, in the public service, by setting-up the Pension Transitional Arrangement Department, PTAD, and appointing its substantive head to improve the scheme.
Speaking while declaring open the World Pension Summit, WPS, ‘Africa Special’, President Jonathan noted that pension was not only a vital component of social security, but also a veritable vehicle for nation building.
According to him, investment in pension had profound impact on the well-being of pensioners, society and the economy at large, stressing that “it is imperative that stakeholders in this life-shaping industry engage constantly in dialogue to bolster management frameworks and practices in their respective jurisdictions.”
He recalled that “In 2004, the Pension Reform Act was enacted by the Olusegun Obasanjo’s administration, to address the recurring challenges experienced in the administration of pension and to enhance efficiency in the system.
This reform initiative established the Contributory Pension Scheme, CPS, for the public and private sectors. In 10 years of sustained policy innovation and meticulous management, these have facilitated confidence and credibility in our pension system and administration.
It also strengthened our pension institutions, as we transited from a deficit of about N2 trillion (USD 12.9b) in 2004 to accumulate pension assets of over N4.21 trillion (USD27.2b) by March this year.
“As provided by the Act, we have restructured the system of administration of the defunct Defined Benefits Scheme, DBS, in the public service, by setting-up the Pension Transitional Arrangement Department (PTAD) and appointing its substantive Head, in order to improve the scheme. Our goal is to digitize pension payments and streamline payment procedures to ensure prompt and ease payment of pension benefits.”
Speaking on the 2014 Pension Reform Act, PRA, he recently signed into law, the President said “I signed into law, the new Pension Reform Act 2014, which repealed the 2004 Pension Reform Act.
The new law seeks to consolidate the gains of reform, address the identified implementation challenges and provide the enabling legal environment to facilitate the creation of quality instruments through which pension assets could be best invested for infrastructure and real estate development. I am confident that these fresh initiatives will assist us to consolidate the remarkable achievements recorded by the National Pension Commission (PenCom) in the implementation of the Contributory Pension Scheme, over the last ten years, for the benefit of contributors, and the entire economy.
“It is our expectation that PenCom would put in place the necessary regulatory and supervisory framework to facilitate and accelerate the objectives of the reform. Most especially, ensuring the safety of pension assets and hence, workers’ security in retirement.
I believe that other African countries share similar experiences, and reform zeal, as Nigeria and it is encouraging that a number of African countries have visited Nigeria, to understudy our pension reform and share ideas which we believe can be useful to the entire continent.”