By Johnbosco Agbakwuru
The newfound collaboration between the Pension Commission, PenCom, and EFCC to enforce strict compliance with pension laws may have set the PenCom on a collision course with some forces which are bent on running PenCom down and stopping the agency on its stride, writes Johnbosco Agbakwuru.
Pa Lawrence Irabor retired from the federal civil service in December 2003. He expectedly fell on hard times a few months after joining the club of senior citizens who appeared condemned to premature death and endless wait on queues for pension arrears and unpaid gratuities that hardly came due to the corruption and mismanagement that bedeviled the old pension scheme or Defined Benefits Scheme, DBS.
The story is different for Mrs. Abdulwaheed, a resident of Ilorin, Kwara State who retired two years ago as a nurse under the Contributory Pension Scheme (CPS) courtesy of the Pension Reform Act 2004, further amended in 2014.
She had a Retirement Savings Account (RSA) into which her pension contributions were paid. She regularly tracked her accruals through a regular RSA account statement from her Pension Fund Administrator (PFA) and was able to plan for life in retirement with some measures of certainty.
By virtue of Section 11 of the PRA, 2014, it is obligatory of the employer to deduct at source, the monthly contribution of the employee from the employee’s salary in addition to the employer’s contribution and remit it to the Pension Fund Custodian (PFC) specified by the employee’s Pension Fund Administrator (PFA).
Regrettably, although failure to remit contributions is punishable by provisions of Section 11 (6) and (7) as well as Section 24(d) of the PRA 2014, many employers of labour are bent on circumventing the law.
For instance, whereas a total of 7,006,734 employees were registered as at March 2016, only the pension deductions of 6,879,179 workers were remitted, leaving a deficit of 127,555.
It is against this backdrop that the current inter-agency collaborative efforts between PenCom and the Economic and Financial Crimes Commission (EFCC) to crackdown on remitters and violators of other provisions of PRA 2014 is good music to the ears of the Nigerian workers and pensioners.
Speaking at a recent news conference ahead of the 2016 World Pension Summit- Africa Special, to be hosted in Abuja this September, the Director-General (DG) of PenCom, Mrs. Chinelo Anohu-Amazu, revealed that the Commission and the EFCC were collaboratively compiling, for prosecution, a list of employers who have not been remitting deducted pension contributions.
“We receive calls from individuals showing proof of deductions from their salaries, and when they look at statements from their PFAs, it does not tally. This in itself is the beauty of the contribution pension scheme because you can check while you are still working than when you are already retired”, she said.
The DG insisted that non-remittance of deducted pension contributions of workers “is in itself a financial crime”.
According to PenCom, non-remittance is on two fronts, namely, those who are not contributing at all and those who have their contributions deducted from their salaries and not sent to their RSA.
Investigations also showed that the agency has not been resting on its oars as it has applied sanctions, in addition to engaging pension recovery agents to recover the unremitted funds. Also, those who caught are not only liable for what they have not remitted, but also for any interest that ought to have accrued to that amount.
Findings show that PenCom had dragged 243 employees to court for non-remittance as at May 2015, while also taking steps to protect the whistleblowers, mainly employees, from victimization.
PenCom has not also spared the PFAs in its regulatory efforts as it imposes fines or issues regulatory directives. In an extreme case in 2011, the Commission sacked the Board of the First Guarantee Pension Limited (FGPL), including a former Member of the House of Representatives and former Vice Chairman of the Board; former Board Chairman, Chief Orlando Ojo; and a Director, Mr. Derick Roper, from the Board of FGPL pursuant to the provisions of Section 88 (2) of the PRA 2004.
The regulatory agency also set up an Interim Management Committee (IMC) pursuant to Sections 20(i) and 21(j) of the Act, pending the reconstitution of the Board of the PFA.
PenCom said its action was compelled by the need to protect pension assets being managed by the PFA as various routine and special examinations on FGPL in 2007, 2008, 2009, 2010, and 2011, revealed persistent infractions and unhealthy corporate governance practices allegedly perpetrated by the trio.
Expectedly, such stern regulatory dispositions of PenCom have not gone without backlashes. Stakeholders who spoke to Saturday Vanguard believe the affected institutions and individuals were behind the recent efforts to tarnish the image of PenCom and its leadership.
For instance, a group, Centre for Public Accountability, CPA, recently called on President Muhammadu Buhari to order an investigation into the management of the statutory 0.3 per cent annual fees on pension assets being accruable to PenCom, alleging fraud and irregularities.
This accusation, coming on the heels of the joint PenCom-EFCC crackdown on sharp practices in accordance with the Pension Reform Act (PRA) 2014, has sent tongues wagging.
Even more curious is the fact that the not-well-known petitioners limited the timeframe for investigation specifically to the incumbent DG’s tenure, which not only spearheaded the PRA 2014 that tightened the noose around pension law offenders but has also had a running battle with defaulters and persons suspected to have perpetrated frauds in the industry.
The dismissed board members of the FGPL have also petitioned the presidency and the House of Representatives accusing PenCom and the DG of highhandedness and impunity.
The petitions were also irrespective of pending court cases on the matter. However, while the petitioners surprisingly failed to show up at the Hearing by the House Committee on Public Petitions, PenCom appeared before the House Committee, where it submitted a compendium of alleged frauds and infractions allegedly perpetrated by the dismissed board members.
Although no member of the labour leadership was readily available to speak on the attacks on PenCom as at press time, it would be recalled that the DG recently bagged the Trade Union Congress, TUC, “Excellent, Visionary, and Emphatic Leader Award” at the Triennial National Delegates Conference/Excellent Service Award.
The National President of the TUC, Comrade Bobboi Bala Kaigama, said Anohu-Amazu had shown distinction and touched the lives of Nigerian workers positively through her firm leadership and protection of pension assets workers.
Workers spoken to have also urged PenCom not to buckle under any form of pressure as its collaborative efforts with EFCC would give both momentum and bite to strict enforcement of PRA 2014.
As PenCom and EFCC square up with the cabals in the pension industry, Nigerians believe that with the staunch political backing the agencies are getting from President Muhammadu Buhari, the days of the cabals are numbered.