Operators Invest N29.4bn Pension Funds in Infrastructure

• Operators Invest N29.4bn Pension Funds in Infrastructure

Pension Funds Administrators have invested about N29.4bn of the growing assets under the Contributory Pension Scheme in infrastructure projects as of the end of March 2019.

Figures obtained from the National Pension Commission revealed that the operators raised the funds invested in infrastructure to N18.5bn as of the end of 2018 from N6.8bn at the corresponding period of 2017 under the Contributory Pension Scheme.

The total assets under the CPS which had continued to maintain a steady rise stood at N9.03tn in March.

Under the Pension Reform Act 2014, the PFAs invest the accumulating funds in different investment portfolios, which are in the custody of the Pension Fund Custodians.

Some of the funds were invested in agency bonds, supra-national bonds, commercial papers, foreign money market securities, and open/closed-end funds.

Other investment portfolios where the operators invested the funds are REITS, private equity funds, infrastructure funds, cash and other assets.

The acting Director-General, PenCom, Mrs Aisha Dahir-Umar, said the commission had recently embarked on a number of initiatives which would impact positively on the Nigerian financial market and economic development in the mid to long-term.

These initiatives include the introduction of micro pension and non-interest funds, she added.

The President, Pension Fund Operators Association of Nigeria, Mrs Aderonke Adedeji, noted that the issue of the role of pension funds in economic development had moved into the focus of public attention, particularly with regard to Nigeria’s growing need for long-term capital.

She explained that successful mobilisation of pension fund assets and contributions to the economic growth of any nation were essential policy objectives.

“For the first time, our country can now boast of a long-term funding base and the impact to date has included the funding of the government and government projects, development of the capital market as well as increased foreign development inflows,” she added.

While this was positive, Adedeji said a note of caution must be raised in view of recent agitations to access the funds for infrastructure.