PenCom recovers N9.38bn contributed pensions from companies - NIKE POPOOLA

Director General (DG), PenCom, Mrs. Chinelo Anohu-Amazu

The National Pension Commission has recovered N9.38bn from various employers of labour across the country that failed to remit pensions deducted from their workers’ salaries under the Compulsory Pension Scheme to the employees’ respective Retirement Savings Accounts.

The contributions of about 127,555 workers to the pension funds as of March this year are still outstanding, according to the latest report obtained by our correspondent.

The report also showed that the defaulting firms were made to pay fines amounting to N348.81m.

“Following the issuance of demand notices to defaulting employers whose liabilities had been established by the consultants, some employers remitted the outstanding pension contributions and penalty of N348.81m in March, making the total recoveries from inception N9.38bn,” it stated.PenCom had relied on the services of consultants to recover the funds and the commission said that 55 of the consultants would continue with the recovery of the outstanding pension contributions.

According to figures obtained from PenCom, a total of 7,006,734 employees were registered as of March 2016 but the pensions of only 6,879,179 workers were remitted.

PenCom noted that at the end of 2015, about 6,885,396 employees registered for the CPS but their employers only remitted the pension deductions of 6,754,114 workers.

The implication of the continuous non-remittance of the pension contributions of the workers is that the employees may have little or no pension money in their RSAs to fall back on when they retire, according to the commission.

PenCom stated that it had continued to apply sanctions against errant firms as well as collaborate with key stakeholders through public enlightenment campaigns to ensure strict compliance by employers of labour with the CPS guidelines on pension deduction and remittance.

The commission also said it would continue to engage defaulting employers through its pension recovery agents to recover unremitted contributed pensions.

It noted that the risk-based examination approach was implemented as a way of promoting transparency and providing early warning signals as well as encouraging pension operators to regularly self-evaluate their positions.

As part of its plans to include the informal sector in the CPS, it said it had embarked on consultation with some key stakeholders with a view to mobilising the self-employed and persons working for organisations with less than three employees to participate in the micro-pension scheme.

PenCom stated, “The consultation was to provide stakeholders’ perspectives and preferences in saving for retirement, which would allow the commission to finalise the framework and guidelines for the micro pension.

“In this regard, consultation was held with leaders of the Lagos State Council of Trade Men and Artisans and the Nigerian Builders Association.”

It also said that a meeting was held between the commission and the Central Bank of Nigeria to discuss the modalities for using the mobile money platform for pension contributions as well as the Bank Verification Number for verification and validation during registration of micro-pension participants.

As part of efforts to expand its coverage, it said it developed a 12-to-18 month road map for the engagement of labour unions, state employees, state government officials and other stakeholders to positively influence compliance at the state level.

In order to ensure smooth implementation of the action plans articulated in the road map, PenCom said technical support and guidance would continue to be given to all 36 states in the country.

It was learnt that the Federal Government had also not been remitting the pension contributions of most of its workers to their RSAs since October last year.

This was contained in the 2016 annual report of the Pension Fund Operators Association of Nigeria.

PenOp stated in the report that “compliance with regard to remittances of pension contributions from the public sector at both the federal and state levels have lagged notably. While remittances from the Federal Government through the National Pension Commission were last received for September 2015, some states have outstanding remittances dating back to over two years.”

Meanwhile, a former board member of the National Pension Commission, Mr. Ivor Takor, has urged the government to increase the monthly pension remittance from 15 per cent of the workers’ total emolument to 18 per cent as stipulated in the Pension Reform Act 2014.

He said that it was important for the state governments to pay the salaries of their workers regularly because if it was not consistent, it would not be possible for them to remit the workers’ pensions.

Takor also expressed worry that most state governments were not funding their accrued pension rights, which made it difficult for retirees to obtain their pensions.

While many of the state governments were not remitting the pension deducted from their workers’  salaries to their respective RSAs kept with the PFAs, he noted that some states had yet to enact the necessary pension laws to adopt the CPS.

The Director-General, Ondo State Pension Commission, Mr. Jaiyeola Olowosuko, said that the CPS was being hampered by the same non-funding problem, which the old pension scheme had encountered.

Despite several pension laws enacted and amended in the country since 1960, he said that the statutory provisions had not improved the lot of the pensioners.

He also observed that the inflationary effect on the economy had reduced the value of pensions earned by the retirees.