BY VICTOR AHIUMA-YOUNG
National Pension Commission,PenCom, has said it is taking some drastic steps to recover un-remitted pension funds from defaulting organizations, lamenting that one of the greatest challenges facing the Contributory Pension Scheme, CPS, in Nigeria is non-remittance of deducted funds by private sector organizations.

Director-General of PenCom Mr. M. K.Ahmad at a one-day interactive session on the Pension Reform Act, PRA, 2004, it jointly organized with the Nigeria Employers Consultative Association, NECA, gave insight why some public sector employees had zero balances in their Retired Saving Accounts, RSAs.

Represented by Mr. Ehimeme Ohioma, Head, Investment Supervision Department Unit, Mr. Ahmad said the session provided the participants with opportunity to diagnose the challenges facing the implementation of the CPS.

According to him, “The Commission as the apex authority saddled with the responsibility of regulating and supervising the pension industry, has been making efforts with a view to ensuring a vibrant and sustainable pension industry that positively impact on the economic development of our dear nation.

The industry has continued to witness steady growth. Pension assets as a percentage of Gross Domestic Product (GDP) had been on a steady increase. The CPS had accumulated N2.3 trillion investible funds that would assist in the economic development of the country.”

“The Commission continued to issue guidelines and regulations while reviewing existing ones to further entrench sound corporate governance in the industry and ensure adequate protection of pension assets.

The Commission is currently working on a Framework for voluntary Participation in the CPS which will provides opportunity for those in the informal sector to make savings to cater for their retirement. The Commission is also working with other regulatory agencies to promote the development of alternative assets classes in which pension funds could be invested to promote national development.

“In an effort to ensure the compliance with the provisions of the PRA 2004, the Commission had adopted various strategies which included on-site inspection of employers, collaboration with regulatory and professional bodies, public enlightenment campaigns and application of regimes of sanctions.

The Commission also continued to collaborate with other Government Agencies in achieving full compliance by the Private Sector. In this regard, the support of the Bureau of Public Procurement (BPP) was obtained to ensure that any supplier, contractor or consultant bidding or soliciting contract or business from any Federal Government Ministries, Departments and Agencies (MDAs) must fulfill its obligations to workers with respect to pensions and must comply with the provisions of the PRA 2004 as required under section 16(6) (d) of the Public Procurement Act 2007. That had significantly contributed to compliance with the PRA 2004 by private sector organizations.”

Speaking on the challenges facing the implementation of the CPS, the Director-General, said the challenges include “the failure or refusal of some Ministries, Departments and Agencies (MDAs) to provide their nominal rolls to enable the Commission credit their employees Retirement Saving Accounts (RSAs) with monthly pension contributions.

Thus, some public sector employees still have zero balances in their RSAs.Other challenges include the unwillingness of some private sector organizations to join the CPS while others who have joined do not remit the monthly contributions as and when due.

To address these challenges, the Commission is soliciting the support of relevant government agencies to ensure that all MDAs submit their nominal rolls bi-annually. Also, the Commission would engage recovery agents to follow up on outstanding pension contributions from defaulting private sector employers.”

Earlier, Director General of NECA, Mr. Segun Osinowo, said the interactive session was an opportunity to review the scheme since inception in 2004 to know the challenges faced by operators, employees, retirees and other stakeholders.

Represented by Mr. Timothy Olawale, Deputy Director of NECA, Mr. Osinowo recalled the state of pension especially in the public sector before the reforms and said since the 2004 reform, how have we felt, what are our experiences, what are the feedbacks from employees who have retired under the new scheme, what about the operators and so on?”