By Victor Ahiuma-Young

The National Pension Commission, PenCom, has disclosed that no fewer than 111,210 employees who retired on the Contributory Pension Scheme, CPS, since 2007, have received payouts of over N268 billion.

The protesting pensioners, yesterday.

Director-General of the commission, Mrs. Chinelo Anohu-Amazu, who revealed this in Lagos at a social gathering to commemorate the 10th anniversary of pension reforms in Nigeria, noted that the cardinal principle of separation of custody from management and supervision had resulted in a pension scheme with sound internal mechanism for transparency and accountability.

She reiterated that “whereas the Pension Fund Administrators, PFAs, manage the pension funds, they do not have access to same as custody is vested in the Pension Fund Custodians, PFCs, and the commission ensures both parties adhere strictly to regulations governing pension funds.”

According to her, “the ring fencing of pension fund assets and regulatory non- interference has resulted in the consistent growth of a large pool of pension assets worth about N4.5 trillion which are invested in structured and safe financial instruments; a remarkable growth when compared with huge estimated pension liabilities in the public sector prior to the reforms in 2004.

The reforms has also engendered a regime of regular payment of retirement benefits to all employees who retired under the scheme since 2007 without any delays as was the practice in the old system. Since inception, 111,210 retired employees have received payouts of over N268 billion.

“Also, through an enhanced compliance regime, 6.26 million contributors have so far been registered into the CPS. Despite these records, we are by no means suggesting that journey has reached its destination. We are not unmindful of some challenges that are yet to be extinguished, for instance issues around the old Defined Benefit Scheme in the public sector. In addition, there are some issues that cropped up only in the course of implementing the PRA 2004.

“In the quest to usher the Pension reform into its second decade, a major review of the PRA 2004 was carried out with a view to proffering solutions to noted implementation challenges.

“Having undergone extensive legislative scrutiny, the Pension Reform Act 2014 was re-enacted in July, 2014. Some of its salient provisions include the expansion of coverage for private sector employees, upward review of minimum contribution rate geared at enhancing the adequacy of pension benefits, upward review of sanctions and penalties against infractions, informal sector participation in the scheme, standards for the participation of states and local governments in the scheme, amongst others.

“As we focus on the implementation of these new provisions, we seek your usual unflinching support in order to sustain what we collectively achieved over the past 10 years.”

The Director-General recalled that “the pension reform process commenced in 2003 with the inauguration of the Fola Adeola Pension Reform Committee, PRC, by President Olusegun Obasanjo.

The high point of the committee’s recommendations was the establishment of the CPS for both the public and private sectors through the enactment of the Pension Reform Act, PRA, 2004.

The reform was envisioned as a well thought-out process of addressing a catalogue of challenges that impeded pension administration in Nigeria, all of which could be summarized into the failure to deliver on a promise of consistent and timely income for workers at retirement.