Business

Low Savings: 92,925 Retirees Quit Contributory Pension Scheme

Published

6 years ago

August 2, 2018

Low Savings: 92,925 Retirees Quit Contributory Pension Scheme

More retirees are quitting the Contributory Pension Scheme and withdrawing the funds in their Retirement Savings Accounts because they do not have more than N550,000 in their accounts as of the time of their retirement, investigation has revealed.

Figures obtained by our correspondent indicated that as of the end of March 2018, no fewer than 92,925 retirees had withdrawn N22.99bn from their RSAs.

It was also discovered that foreign nationals, who were contributors to the CPS and notified their Pension Fund Administrators of their intentions to return to their home countries, had similarly withdrawn their savings and opted out of the scheme.

Out of the retirees who exited the CPS, 6,228 and 2,408 are from the federal and state civil and public services, respectively, while 84,289 are from the private sector.

While noting that the number of those leaving the scheme had continued to increase, the National Pension Commission revealed that 78,997 retirees in the various categories withdrew their total RSA balance of N19.16bn during the corresponding period of 2017.

A PenCom report stated, “The commission granted approval for the payment of the entire RSA balances of the categories of retirees whose RSA balances were N550,000 or below and considered insufficient to procure programmed withdrawal or an annuity of a reasonable amount over an expected lifespan. Approval was also granted for the payment of the RSA balances to foreign nationals who decided to return to their home countries after making voluntary contributions under the CPS.”

“Accordingly, the sum of N0.92bn was paid to 3,081 RSA holders comprising 154 public (federal and states) and 2,927 private sectors retirees. Consequently, 92,925 retirees received en bloc payments totalling N22.99bn from inception to the end of the first quarter of 2018.”

It was also discovered that most of the retirees affected were those whose employers had been deducting their monthly salaries but not remitting the deducted amounts to the Pension Fund Administrators.

PenCom noted that it had continued to use the services of its recovery agents to get unremitted pension deductions from the defaulting employers.

The Pension Reform Act, 2014 states that retirees can only access their monthly pensions either by subscribing to programmed withdrawal administered by the PFAs or annuity sold by life insurance companies.

To subscribe to any of the policies, retirees must have more than N550,000 in their RSAs or the total balance would be returned to them.

As of the end of May this year, the total assets under the CPS had risen to N8.14tn, according to the commission.

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Samed Olukoya

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

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Business

New Website Unveiled by FG for Pay-Later CNG Conversion to Cut Transport Costs

Published

3 days ago

October 10, 2024

Yetunde Olugbenga

The federal government has unveiled a website that offers a pay-later option for commercial and private car owners looking to convert their petrol-powered vehicles to Compressed Natural Gas (CNG).

This was in response to the incessant increase in transportation fares following the removal of the fuel subsidy.

According to the Presidential Compressed Natural Gas Initiative (PCNGi) the initiative will help ease transportation costs and encourage more transporters to embrace CNG.

In a post on X, the National Orientation Agency (NOA) revealed that this initiative ensures a hassle-free experience for CNG users through an easy online application and a quick approval process.

“Switching to Compressed Natural Gas (CNG) is now more accessible than ever. With flexible payment plans tailored to fit your budget, transitioning from petrol to CNG has never been smoother or more affordable. These payment options allow you to convert your vehicle now and pay later with affordable monthly installments at competitive rates.” NOA stated.

The installment payment option aims to achieve the federal government’s projection of a 30-40% fare reduction as more motorists adopt this initiative.

In addition to the distribution of 2,000 CNG-powered tricycles among youths in the transportation sector across Nigeria, the pay-later option is intended to encourage more people to adopt CNG, thereby providing affordable mobility options.

Business

Nigerians Fear Increase in Fake Products as NAFDAC Officials Commence Indefinite Nationwide Strike

Published

6 days ago

October 8, 2024

Ugwoke Ogbodo

There are indications that fake producers of consumables and other items across the country may have a field day following an industrial action embarked upon by workers of the National Agency for Food and Drug Administration and Control (NAFDAC).

Investors King gathered that the nationwide strike which started on Monday is indefinite and nationwide.

The decision of the staff of the agency to down tools followed the expiration of a 14-day ultimatum issued to their management.

The decision to shun work was confirmed after a congress of NAFDAC staff convened on Friday, October 4, 2024 over unresolved issues.

The striking workers, under the directive of the Senior Staff Association of Statutory Corporations and Government-Owned Companies (SSASCGOC) have been instructed to withdraw all services and vacate offices.

They were also ordered to remove personal belongings as the strike began.

The demands of the staff include a review and re-evaluation of the 2024 promotion examination results, which currently reflect a pass rate of just 35%.

The union is pushing for a minimum benchmark of 80% for this year and future exams. Another key demand is the settlement of salary arrears for employees hired in 2022 among others

In a statement signed by Secretary of the Association, Ejor Michael, the union accused NAFDAC management of ignoring their grievances, calling the inaction insufferable.

The staff have vowed to continue the strike until all demands outlined in their communiqué are met.

NAFDAC, which plays a critical role in regulating Nigeria’s food, drug, and pharmaceutical industries, is expected to face significant operational disruptions as a result of the industrial action.

Before now, there had been public outcry over the increase in fake products as Nigerians called out the agency and tasked it to be more proactive.

They expressed fear that there is a tendency that manufacturers of fake products would have ample opportunities to saturate the markets with dangerous products as those who would tackle them are now on strike.

Business

27.75% Interest Rate Painful but Necessary – CBN Gov Cardoso

Published

6 days ago

October 7, 2024

Bassey Marshall

The Governor of the Central Bank of Nigeria (CBN), Yemi Cardoso, has described the recent increase in the Monetary Policy Rate (MPR) to 27.25% as a painful but necessary move.

Cardoso made this known in Lagos, during his address to members of the Harvard Club of Nigeria on the topic: “Leadership in Challenging Times: Restoring Credibility, Building Trust, and Containing Inflation”.

Investors King reported that on September 24, 2024, the apex bank announced another increase in its Monetary Policy Rate (MPR) from 26.75 percent to 27.25%

The decision was reached during the Monetary Policy Committee (MPC) meeting chaired by the CBN Governor.

However, while delivering his speech in Lagos, the CBN boss sympathized with borrowers highlighting the pain the new interest rate will heap on them.

According to Cardoso, the bank’s decision to raise the interest rate was a bold move to reduce excess money in circulation and control inflation effectively.

He emphasized the need for Nigeria to look beyond short-term comfort and strive to secure long-term stability.

Cardoso reaffirmed the CBN’s commitment to rebuilding public trust in the institution.

He said, “Our decision to raise the Monetary Policy Rate (MPR) to 27.25% was a bold move. Higher interest rates, while painful for borrowers, are necessary to curb excess money in circulation and control inflation.

“Leadership is about making hard choices to secure long-term stability over short-term comfort in moments like these

“Leading through challenging times means avoiding the temptation to take on too many initiatives. The Central Bank must focus on its core mandate—price stability. It is easy to become distracted by various political and economic pressures, but as a leader, one must prioritise.”

“Trust is the currency of central banking. If the public loses trust in the institution, the efficacy of its policies diminishes.

“Our decision to implement the Electronic Foreign Exchange Matching System (EFEMS) is rooted in this understanding.

“By enhancing transparency and providing more accurate oversight of forex transactions, we send a strong signal that the CBN is serious about fair and efficient markets.”

Meanwhile, The Manufacturers Association of Nigeria (MAN) had criticized the interest rate hike by the Central Bank of Nigeria (CBN).

The Director General of MAN, Mr. Segun Ajayi-Kadir, made the association’s position known in a statement titled ‘Reaction of MAN on the Report of MPC Meeting on September 23-24, 2024’.

MAN noted that with the higher interest rate, the cost of production will increase.

According to him, the impact of the increase goes beyond the manufacturers, it will stifle investment opportunities.