Pension

PenCom: Over N4 Billion Remitted to RSAs in Q4 2021

Published

2 years ago

February 28, 2022

The National Pension Commission has disclosed that 1,526 organisations had remitted a total of N4,047,499,080.64 into the Retirement Savings Accounts (RSAs) of their employees in the fourth quarter (Q4) of 2021, data obtained from PenCom’s latest quarterly report showed.

According to the data, the total number of employee savings accounts that were credited stands at 15,603

The report also reveals that at the end of Q4 2021, twenty-five (25) States of the Federation had passed pension laws based on the Contributory Pension Scheme (CPS), with seven (7) states in the process of doing so.

Also, Four (4) of the five (5) states operating other pension plans have adopted the Contributory Defined Benefits Scheme (CDBS), while one (Yobe State) has implemented the Defined Benefits Scheme (DBS).

A Glance at the report

According to the report, 84.7% of applications were issued Pension Clearance Certificates (PCCs). The report read in part: “The Commission received 1,800 applications from private sector organizations for the issuance of Pension Clearance Certificates (PCCs). Out of this number, PCCs were issued to 1,526 organizations, while 274 applications were in the approval process as at end of Q4,2021. The records showed that the 1,526 organizations had remitted a total sum of N4,047,499,080.64 into the Retirement Savings Accounts of their employees totalling 15,603.”

PenCom also revealed that it carried out various workshops on the developments in the CPS for a number of organisations across the six geopolitical zones of Nigeria: “The commission participated at the 2021 Lagos International Trade Fair organised by the Lagos Chamber of Commerce and Industry in collaboration with the Lagos State Government. The fair provided the opportunity to sensitise members of the public on the workings of the Micro Pension Plan as well as respond to other inquiries on the CPS.”

Some Major Highlights

The sum of N984,295,614.20 was recovered from 36 defaulting employers during Q4 2021. This is following the issuance of demand notices to defaulting employers whose pension liabilities were established by the Recovery Agents (RAs).Of the total amount, N406,421,486.65 represented the principal contribution and N577,874,127.55 represented the penalty. Also, legal action against 18 defaulting employers was advised.
The commission also approved the reimbursement of N1,178,670.15 to 8 military and other security personnel who were exempted from the Contributory Pension Scheme during the quarter under review.
The report also claims that the commission received applications for the transfer of NSITF contributions on behalf of 208 NSITF participants during the quarter under review. And approval for the transfer of N10,767,194.61 to 180 members’ Retirement Savings Accounts was granted.
The commission, in the report, denied the request for the transfer of N2,389,145.53 to 28 NSITF donors due to discrepancies between the amount given by PFA and the balances in the NSITF database. In the same light, the commission approved N54,594,952.61 in monthly benefits for 2,305 NSITF retirees.

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Pension

Nigeria’s Pension Fund Value Plummets by 29% to $14.39bn Amid Naira Depreciation

Published

1 month ago

March 19, 2024

Samed Olukoya

Nigeria’s pension fund value has declined by 29% to $14.39 billion in January 2024.

This drop attributed primarily to the ongoing depreciation of the naira against the dollar represents a contrast from the $20.41 billion recorded in December 2023.

The latest unaudited report on the pension funds industry portfolio revealed that the conversion rate of the naira to the dollar played a pivotal role in this decline.

In January, the naira was converted at a rate of N1,356.88/$, a significant deviation from the N899.39/$ rate observed in December.

This depreciation trend in the naira has been persistent since June 2023, following adjustments made by the Central Bank of Nigeria.

The continued weakening of the national currency in 2024 further exacerbated the erosion of the pension fund’s value when measured in dollar terms.

While the dollar value of the pension fund experienced a substantial downturn, in naira terms, the total assets under the Contributory Pension Scheme witnessed an increase to N19.53 trillion from N18.36 trillion at the end of 2023.

A significant portion of these assets, estimated at N12.14 trillion, was invested in Federal Government securities, reflecting a strategy to navigate the challenging economic landscape.

Amidst concerns over the impact of naira depreciation on pension funds, stakeholders have emphasized the need for prudent financial management and diversification of investment portfolios to mitigate risks associated with currency fluctuations.

Pension

Pension Fund Administrators Channel N130 Billion into Infrastructure Investments

Published

5 months ago

November 27, 2023

Investors King

Pension Fund Administrators (PFAs) have strategically invested N130.18 billion from the Contributory Pension Scheme into infrastructure projects by the end of September 2023.

The data from the National Pension Commission reveals the commitment of PFAs to diversifying their investment portfolio while maintaining compliance with the Pension Reform Act of 2014.

As of the reporting period, the total assets under the Contributory Pension Scheme amounted to N17.35 trillion.

In addition to infrastructure investments, PFAs directed funds into various avenues, including domestic and foreign ordinary shares, federal and state governments’ securities, and money market instruments.

The investment strategy aligns with the amended investment regulation introduced by the commission.

The regulation outlines stringent requirements to ensure prudent and compliant investment practices in line with the provisions of the Pension Reform Act.

It emphasizes that pension fund custodians should adhere to written instructions from licensed PFAs regarding the investment and management of pension fund assets.

The regulation also sets guidelines for allowable investments outside Nigeria, and PFAs are cautioned against contracting out the custody of pension fund assets to third parties without prior approval.

This strategic approach not only upholds regulatory standards but also serves the long-term interests of contributors, ensuring a balanced and diversified investment portfolio.

Pension

Federal Government Completes N1.02 Billion Payment to Power and Transport Pensioners

Published

6 months ago

November 6, 2023

Investors King

The Federal Government announced the successful disbursement of N1.02 billion to 7,091 pensioners from the Power and Transport Sectors of the Parastatals Pension Department.

This vital step to fulfill pension obligations was revealed by Olugbenga Ajayi, the Head of the Corporate Communications Unit at the Pension Transitional Arrangement Directorate (PTAD), in a statement released on Sunday.

The allocated sum accounts for 39% of the accrued pension arrears owed to retirees in these sectors for the period spanning from August 2015 to September 2023.

The process involved a meticulous calculation of each pensioner’s monthly pension based on their career details, salary structure, and applicable pension increments.

This commendable initiative stemmed from the realization that 7,091 pensioners in the power and transport sector were receiving inadequate pension payments due to discrepancies within the inherited payroll system managed by PTAD.

Dr. Chioma Ejikeme, the Executive Secretary of PTAD, reiterated the government’s commitment to upholding fairness, equity, and justice, ensuring that every pensioner receives their rightful pension under the Defined Benefit Scheme.

Dr. Ejikeme also assured federal pensioners that the payment of accrued pension arrears would continue until all obligations are satisfied, subject to the availability of government funding.

This announcement underscores the government’s unwavering dedication to the welfare of retirees and is a significant milestone in addressing outstanding pension liabilities in the country.