By Moses Emorinken, Abuja
The National Pension Commission (PenCom) has reiterated that its priority is the payment of retirement benefits as and when due, and would not be distracted by the upsurge of clamour for deployment of pension funds to support several new initiatives in both the public and private sectors.
The Acting Director-General of the PenCom, Aisha Dahir-Umar, who made this known Tuesday in Abuja, at the capacity development conference for Directors of Pension Fund Operators, said that such requests for ‘clearance’ of several business proposals to enable Pension Fund Administrators finance the initiatives with pension fund, is at best a derailment from the main objectives of the pension reform.
According to her, “It is no longer news that the pension industry in Nigeria is leading the initiative for the attainment of one of our critical national imperative for socio-economic development, which is the formation of long term domestic capital.
“The industry has accumulated assets worth over N9.4 trillion as at August 2019. These pension assets are overwhelmingly invested in the national economy, with positive impact in all major sectors and a significant contribution to the GDP.
“What is news, however, is the recent upsurge of clamour for deployment of pension funds to support several new initiatives in both the public and private sectors. Often times, such clamours are inappropriately pursued by its proponents. For instance, our enabling law, the Pension Reform Act 2014, only empowers the regulator to issue Regulations on Investment of Pension Funds and Assets to guide the investment activities of the licensed operators.
“The law does not allow the regulator to ‘approve’ any specific instrument for mandatory investment by operators. Regrettably, the Commission is increasingly being inundated with requests for ‘clearance’ of several business proposals to enable Pension Fund Administrators finance the initiatives with pension fund.
“While these developments may be indicative of the high level of acceptability and robustness of the Pension Reform, they also call for increased vigilance by both the regulator and operators against derailment from the main objectives of the Reform, which is the payment of retirement benefits as and when due”.
She further added: “The pension industry players have a joint responsibility, not only to consolidate on the successes of the reform recorded this far, but also to build a sustainable pension industry that can effectively deliver on its primary social mandate of retirement benefits payment”.
The Chairman of the Senate Committee on Establishment and Public Service, Senator Malam Ibrahim Shekarau, in his address also said: “The Directors conference is a platform to promote excellence in corporate governance and exhibit the resolve of the national pension industry towards sustaining the aims of the pension reform in Nigeria.
“The theme demonstrates the resolve of the pension industry to not only guarantee the safety of the pension assets but also to ensure that the pension contributions are invested responsibly to provide long-term financing needed to estimate growth and development as a global best practice.
“The National Assembly will continue to support the reforms in the pension sector by ensuring the timely consideration of all actions aimed at strengthening the pension legislation for the ultimate benefit of Nigerian citizens.
“We shall ensure that adequate budgetary provisions are made to ensure the timely payment of retirement benefits of workers in the federal public sector.”
Chairman, House Committee on pensions, Hon. Kabiru Alhassan Rurum, also commended the efforts of the PenCom to secure pension funds and the continued sustenance of the appreciating level of pension asset.