September 13, 2022

Job losses: Withdrawals from pension savings rise 17% to N6.6bn


By Rosemary Iwunze

Following hardships occasioned by loss of jobs, cash withdrawals by sacked workers from their pension contributions jumped by 17.5 per cent to N6.65 billion in the second quarter of 2022, Q2’22, from N5.66 billion recorded in the corresponding period of 2021.

However, according to the report released by the National Pension Commission, PenCom, yesterday the number of sacked workers that withdrew from their pension savings declined by 2.8 per cent to 9,250 in Q2’22 from 9,517 in Q1’22.

It will be recalled that the Pension Reform Act 2014 permits the payment of 25 per cent of pension contribution to Retirement Savings Account, RSA, holders under the age of 50 years, who are sacked (disengaged) from work and unable to secure another job within four months.

The report noted: “The Commission granted approval for the payment of N6,645.54 million (being 25% of their Retirement Savings Account, RSA, balances) to 9,250 RSA holders under the age of 50 years, who were disengaged from employment and unable to secure another job within four months in Q2’22.

“This is against the payment of N5,661.68 million to 9,517 RSA holders under the age of 50 years, who were disengaged from work and unable to secure jobs within four months in Q1’22.”

Meanwhile, according to the report, total pension contributions remitted to individual RSAs in Q2 2022 stood at ¦ 238.75 billion.

“Out of this total, the public sector accounted for ¦ 136.79 billion or 57.29%, while the private sector contributed ¦ 101.96 billion or 42.71%. The cumulative pension contributions from inception to the end of the second quarter of 2022 amounted to N8.01 trillion, which is an increase from N7.77 trillion as at the end of Q1 2022.

“A total number of 3,831 Micro Pension Contributors (MPC) were registered during the period under review by 17 out of 18 Pension Fund Administrators bringing the total number registered to 80,419 as at June, 2022.

“The total Pension Contributions received from MPCs in Q2 2022 was ¦ 22,193,664.59. This brings the total Pension Contributions received to ¦ 280,780,481.42 from 9,586 MPCs as at 30 June 2022.”