September 8, 2021

Katsina keys into contributory pension scheme

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By Victor Ahiuma-Young

Katsina State House of Assembly has passed an executive bill for the establishment of a contributory pension scheme in the state.

The bill, presented by Governor Aminu Masari, was passed by the assembly during its plenary, presided over by the Speaker, Alhaji Tasi’u Maigari.

The passage of the bill followed the presentation of the report of an ad-hoc committee, chaired by Deputy Speaker, Alhaji Shehu Dalhatu-Tafoki.

Dalhatu-Tafoki said the committee was named “ad-hoc committee on contributory defined benefit pension scheme.”

He explained that the bill was an embodiment of a proposal from the executive for the introduction of a new pension policy for the state.

According to him, “The presentation of the bill itself was in line with the reform of the pension system initiated by the Federal Government in 2004. The reform culminated in the enactment of the Pension Reform Act, 2014(as amended). The new act has made it mandatory for states, local governments and private sectors to adopt and implement the contributory scheme for their employees.”

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The lawmaker explained that the only significant difference between the new pension scheme and the current system was the size of contribution which an employee was required to make under the new scheme.

“The Katsina State government desires to emulate the model operated by Jigawa State government which is based on defined benefit. Consequently, the model is a replica of that of Jigawa. The bill has made adequate transitional provision that will guarantee continuation of payment of benefits to civil servants who are not covered by the new scheme,” he said.

According to him, drawing from the observations, the committee concluded that the current pay-as-you-go system was bedevilled with numerous problems that signal its unsustainability .

“The economic depression in the country suggests that it can no longer support the smooth implementation of the existing system. The paradigm shift of the policies that govern the pension landscape is the ultimate panacea to the lingering problems that beset the sector,” he said.

According to the committee, the adoption of the Jigawa model will promote the objectives of the law.

The lawmakers, after an extensive debate on the issue, unanimously adopted the report and passed the bill for the introduction of the new pension scheme in the state.

Vanguard News Nigeria