By Rosemary Onuoha

The National Pension Commission (PenCom) has directed Pension Fund Administrators (PFAs) controlling over N100 billion and above  to create certain departments while potential personnel for top management positions must meet certain requirements as well.

From July a potential Managing Director in any PFA firm must have 20 years post qualification experience, 15 years financial sector experience and 10 years top management experience.

An Executive Director must have 18 years post qualification experience, 13 years financial sector experience and 7 years top management experience while Head of Department must have 10 years post qualification experience, 8 years financial sector experience as well as 4 years top management experience.

PenCom which gave this conditions in a circular sent to operators in the pension sector reasoned that the new requirements for top management positions would however not affect the existing approved board and top management staff of PFAs, however where a PFA has 10,000 or more RSAs in a State, the PFA must open a branch in that State which must meet service; human resource and ICT requirements.

PenCom maintains that the move became necessary because of the significant growth in the size of pension assets and the changing dynamics of pension business, coupled with the fact that the control of a significant portion of Nigerian Pension business by a few Pension Fund Administrators has made it necessary to strengthen their operations.

According to PenCom, PFAs with funds under management of N100 billion and above must have the following 11 departments at minimum: Contributions/Collections;  Investment;  Benefit Administration; Business Development/Relationship Management; Finance; Information Technology;  Compliance; Risk Management; Internal Audit; Administration/Human Resources; as well as Legal/Company Secretary.

PenCom explained that the Contributions/Collections Department would be the management of overall contribution process. This include among others Contributions Records, Contribution software and contribution document management while Investment Department would be responsible for the Investment Management of pension contributions, Portfolio management, Research & Analysis and Reconciliation etc.

The Benefit Administration Department would be responsible for management of the retirement benefit process.

To this end the Department would ensure that retirees are paid as and when due, keep proper records, determine withdrawal options through consultation with retirees, calculate retirement benefits in line with predetermined formula, establish proper structures for handling retiree issues/complaints etc while Business Development/Relationship Management Department would be responsible for marketing, registration of new clients, follow up with employers to ensure consistent remittance, ensuring the delivery of statement of accounts at the prescribed intervals, ensuring proper service delivery to clients etc;

Finance  Department would be responsible for maintaining adequate books of accounts and records of all funds under management as well as the company in accordance with Nigerian Accounting Standards and guidelines issued by the Commission; Information Technology Department would be responsible for the provision of IT support and IT infrastructure maintenance.