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Forces in Senate against pension reform

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When the Pension Reform Act (Amendment) Bill 2013 was introduced by the President Goodluck Jonathan administration, pensioners and Nigerians in general heaved a sigh of relief that challenges, especially corruption and sharp practices in the old pension system, would be fixed once for all.

The hope was inspired by the passion with which the Senate and the House of Representatives pursued the pension probe and the anger expressed by the lawmakers during the debate on the pension probe report. Senators described the pension loot as blood money.

However, all that hope is fast melting away as intrigues and ethno-religious sentiments seem to have taken the center stage in the consideration of issues that have direct impact on the lives of Nigeria in the National Assembly, especially the Senate.
Ethnic jingoists seem to have their way in the Senate and working seriously to get converts to score some political points. A typical example of this virus trying to infect broad-minded members is the on-going Pension Reform Bill pending in the upper chamber.

Though the bill being considered by both chambers of the national legislative arm would positively impact on Nigerians who had served their fatherland, the issue of who leads the National Pension Commission (PENCOM) has become a big one that has attracted some interest and is badly affecting the process of amending the Act.
The unfortunate intrigue that plays out on the matter is the alleged external influence from some PENCOM former Commissioners who allegedly are working hard to re-enact the third term project introduced into the nation’s polity but died premature death.

The Commissioners are said to be using some elements in both chambers of the parliament to mount pressure and it was gathered that only divine intervention could save the Bill.
Sources said the main interest is pensioners’ money. Like the recent scandal that rocked pension funds in the country, there are some ‘professionals’ and ‘experts’ that have mastered the act of causing misery to people that had meritoriously served the nation by ensuring that they did not get their pension money.

But the Deputy Chairman, House of Representatives Committee on Pension, Hon. Samson Okwu, who represents Oju/Obi Federal Constituency, has condemned the introduction of ethnicity into the consideration of the bill.
He said, “As far as I am concerned, the issue of the National Pension Commission is not an issue that everybody should trivialize by looking at where the DG should come from. Nobody is making law because of somebody who wants to be DG but the competence of the holder of that office”.
If the Pension Reform Bill sees the light of day, with the activation of the of Pension Transition Arrangement Department, PTAD, for the first time since 2004, by the present management of PENCOM, and the proposals in President Jonathan’s bill to strengthen the PTAD, looting of pensioners’ funds in the various pension departments would be a thing of the past.

Pensioners who retired before the coming into force of the Contributory Pension Scheme would also no longer travel from different parts of the country to queue in Abuja to collect their pension.
Already, government has activated the PTAD to lessen the sufferings of the pensioners, while PENCOM is fast opening zonal officers in the six geo-political zones of the country.
The thrust of the Pension Reform Act 2013 Bill is to enhance the powers of the Commission in its regulatory and enforcement activities, enhance the protection of pension fund assets and unlock the opportunities for the deployment of pension assets for national development.

It also tries to review the sanctions regime to reflect current realities, provide for the participation of the informal sector and also provide the framework for the adoption of the Contributory Pension Scheme (CPS) by states and local governments.
The PTAD is designed to take over the payment of pensions to pre-2004 Pension Reform (retirees under the old pension scheme) from the Police Pension Office; Customs, Immigration, and Pension Office, and the Civil Service Pension Department. It is designed to have monies of this set of pensioners transmitted directly into their bank accounts rather than through a third-party (the pension departments).
Unfortunately, the PTAD was not activated in line with Section 30, Sub Section 2 (a) of the Pension Reform Act 2004 until the present Ag. DG took over.

But in order to put an end to the era of impunity and, in some instances, widespread corruption in the various Pension Departments, the PRA 2013 Bill seeks to enhance the regulatory authority and efficiency of the Commission to provide greater oversight on, and reposition the PTAD.
The bill also seeks to review the penalties and sanctions as the sanctions currently provided under the PRA 2004 are no longer sufficient deterrents against infractions of the PRA 2004.
Furthermore, there are currently more sophisticated mode of diversion of pension assets, such as diversion and/or non-disclosure of interests and commissions accruable to pension fund assets, which were not addressed by the PRA 2004.

Consequently, the bill seeks to create new offences and provide for stiffer penalties that will serve as deterrence against mismanagement or diversion of pension funds’ assets under any guise, as well as other infractions of the provisions of the Act.
One of the contending issues in the bill which has brought sharp division within the ranks of the lawmakers is the years of experience. The PRA 2013 Bill reviewed the provision of the 2004 Act with respect to qualifying years of experience for the DG such that the requirement is graduated in descending order from that of the Chairman at 20 years to that of the DG at 15 years.

The bill recommends the removal of the 20 years of experience and replaces it with 15 years and emphasises competence. Laws establishing some other important financial regulatory agencies such as the Central Bank of Nigeria, CBN Act, Nigeria Deposit Insurance Corporation, NDIC, and Federal Inland Revenue Service, FIRS, do not require any years of experience, while the laws establishing the Securities and Exchange Commission, SEC, National Insurance Commission, NAICOM, Corporate Affairs Commission (CAC) require between 10 and 15 years’ experience.
It further said that deemphasizing years of experience is consistent with global best practice, which emphasizes competency rather than years of post-qualification experience, which does not necessarily translate into capacity and capability.

*One of the protester Mr. Felix Adewale Balogun, Chairman Shomolu Local Government Education Authority bin cary out, during  A Protest by Nigeria Union of Pensioners, Lagos state, on non payment of Pensioners arrears and gratuities by Lagos state Government, at Lagos House, Alausa, Ikeja. Photo: Bunmi Azeez
*One of the protester Mr. Felix Adewale Balogun, Chairman Shomolu Local Government Education Authority bin cary out, during A Protest by Nigeria Union of Pensioners, Lagos state, on non payment of Pensioners arrears and gratuities by Lagos state Government, at Lagos House, Alausa, Ikeja. Photo: Bunmi Azeez

This recommendation for appointment of the DG was in line with the position of critical stakeholders during the public hearing on the bill. The National President of Federal Universities Pensioners Association, Ayuba Kura, said that harping on issue of years of experience instead of competence was a bad precedent.
His position was supported by the Vice President, External Affairs of the National Association of Nigerian Students, NANS, Comrade Adamu Kabiru Matazu.
The Nigeria Customs Service, the Immigration and Prisons Pension Office, in their separate submissions, stated, “On the issue of appointment of PENCOM DG, 15 years is enough for anybody to be so appointed more especially, if the person had worked within the system. In addition to cognate experience, there is something that you cannot take away from a person who has worked within a system and knows the nitty-gritty of it.”

The Vice President, Nigeria Labour Congress (NLC), Comrade Isa Aremu, in an interview, said, “As good as the old provisions were, there are lots of gaps. For instance, you put the experience of the DG at 20, you are silent on that of the Commissioners. In fact, for Commissioners, no provisions for any years of experience and as, a matter of fact, Commissioners constitute the reserve pool for future DG.
“If the DG is away, any of the Commissioners could have come on board. So, with the way the existing provision is, a youth corps member or an intern could be made a Commissioner and automatically could become a DG because the provision was very silent on that.

“You can have people with experience, 20 years, 30 years who could be honest and reliable and manage this scheme well. But you could also have people with 30 years of experience and mismanaged the scheme. In fact, some people have argued that after 20 years of experience in any field, such person may not be able to add more value to whatever the person is being given, because of law of diminishing returns”.

But efforts by some former Commissioners seeking third term after completing two terms of four years each as well as ensuring that one of them emerges as the DG have allegedly contributed to frustrating the Pension Bill.
It was gathered that a serving member of the National Assembly from Kano State is the arrowhead of the move to ensure that one of his kinsmen becomes the DG or the bill will be scuttled. The lawmaker has been accused of being the antagonist of the PENCOM Committees.
Recently, the Joint National Assembly Committee on Pension, Establishment and Public Service Matters, saddled with the responsibility of spearheading the amendment of the Pension Act, withdrew the bill allegedly on the orders of the Senate President.

Chairman of the House Committee on Pensions, Rep. Ibrahim Bawa Kamba (PDP, Kebbi), and his Senate counterpart on Establishment and Public Service Matters, Senator Aloysius Etok (PDP, Akwa Inom), had submitted the report to the two chambers in which they recommended the removal of 20 years of experience as a qualification for the appointment of the PENCOM DG.
The joint committee recommended that a person to be appointed to the office of the DG should be a ‘fit and proper person with adequate cognate experience in pension matters’. If the bill is enacted into law, it will pave the way for competence so as not to allow persons that had contributed to the liquidation of banks in the country and persons with questionable character taking over the commission.

Whereas President Jonathan had, in the initial bill sent to the parliament in April, asked for a downward review of the years of experience required of the DG from 20 to 15 years, the report submitted by Etok and Kamba recommended for the total removal of any years of experience describing it as “over-bloated” and unreal since pension management in the real sense of it was less than 10 years. The Committee recommended a “fit and proper person with adequate cognate experience on pension matters for both the DG and the Commissioners respectively”.

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