Pension

PenCom Disburses Outstanding 2.5% Pension Contributions To Retirees

L-L: Mr. Ibrahim Garba Buwai (Principal Manager, Corporate Communications Department); Dr. Babatunde Alayande (Head, South West Zonal Office); Mrs. Carol Alex Uzomah (Assistant General Manager, Corporate Communications Department); Mr. Peter Aghahowa (Head, Corporate Communications Department); Hajiya Maryam Bello (Assistant General Manager, National Databank Management Department; Mr. Ibrahim Kangiwa (Head, Research and Strategy Management Department) at the 2021 Journalists Workshop at Radisson Blu Hotel on 26 July 2021.

BY NKECHI NAECHE-ESEZOBOR–The federal government has began the disbursement of outstanding 2.5 per cent pension contributors to retirees from tomorrow.

The National Pension Commission ( PenCom) disclosed this at a two day 2021 Journalists Workshop programme, organised by the Commission in Lagos recently.

The Director-General, PenCom, Mrs. Aisha Dahir-Umar, who was represented by the head, corporate communications, PenCom, Peter Aghahowa, noted that the Commission is working in line with the approval given by the federal government for payment of outstanding accrued pension rights and 2.5 per cent contributions.

She assured that retirees that retired from 2019 to 2020 would get their 2.5 per cent from tomorrow, while those that retired between 2014 to 2018 would also be settled.

Dahir-Umar explained that the differential resulted from the increase in the minimum pension contribution for employers from 7.5 percent to 10 percent, in line with Section 4(1) of the Pension Reform Act (PRA) 2004.

“These payments would undoubtedly boost the RSA balances of the beneficiaries towards better retirement benefits.

The settlement of these outstanding accrued pension rights of verified and enrolled FGN retirees would result in reversing a major challenge that has lingered since 2014

On number of contributors, she said “the number of registered contributors under the CPS has grown to 9.38 million while pension fund assets have accumulated to N12.66 trillion as at 30 June 2021. The maintenance of a consistent growth trajectory continues to justify the Commission’s overriding investment philosophyof ensuring the safety of pension fund assets.”

She noted the growth in the pension fund assets under the new pension scheme, is an indication of prudent and sincere management of the pension fund by the pension operators and the regulator.

According to her the regulator will continue to dish out policies that will enhance the growth of the pension assets as well as investment options that will ensure that the assets are not depleted.

The 2014 PRA as amended established a Contributory Pension Scheme (CPS) whereby the employers were required to contribute 10 per cent of the employees’ salary to the scheme monthly.

The 10 percent minimum contribution by employers is an increase of 2.5 per cent over the 7.5 percent contribution stipulated by the repealed 2004 PRA.

The Act also mandated employees to contribute a minimum of 8 per cent to the scheme monthly.

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