Accessibility Of Pension Funds: PenCom Sets New Conditionality

The National Pension Commission (PenCom) has set a new conditionality for states desiring to access minimum pension funds.

The Director-General of the commission, Ms. Omolola Bridget Oloworaran, breied on the conditionality today in Abuja at the official launch of the Minimum Pension Guarantee Scheme and the unveiling of PenCare,

PenCare is a pension industry-funded healthcare initiative designed to provide low-income retirees with access to essential medical services free of charge.

Speaking there, the PenCpm director-general stated that the conditionality is that states must contribute to the Pension Protection Fund before they can become eligible for the minimum pension.

 ‎She said about 170,000 retirees are expected to receive the minimum pension of ₦52,500, including those who were previously receiving less than that amount.

‎‎“Every eligible retiree who earns below ₦52,500 will be uplifted to ₦52,500. So, of course, as I said, there is no discrimination if you are within the Contributory Pension Scheme (CPS).

‎‎“However, there is an eligibility criterion at the same level. We are making it a requirement that states must contribute to the Pension Protection Fund before they can be eligible for the minimum pension.

‎‎“So, we will work out that modality at the state level because we all know that the fund needs to be sustainable. If people are not contributing, we will run out of funds, and we cannot start a laudable initiative like this and then, years from now, somebody says it has stopped working because people are not contributing.

‎‎“So, we are working on modalities for the states to start contributing. But, as of now, it does not apply only to federal workers. Even private-sector workers are receiving these minimum pensions.

‎‎“As I said in my speech, 54 per cent of the total number of retirees who fall below the minimum pension work in the private sector, even though the private sector is not the majority employer. Essentially, 65 per cent or more of private-sector retirees are earning less than ₦52,500.

‎‎“So, when we tell them to contribute to the Pension Protection Fund, there is a reason for that. They form a large chunk of the money we need.”

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As to whether there were states paying as paltry as  ₦5,000 monthly, as minimum pension, she stated:

‎‎“Frankly, that is a big shame. What we have done is that we have started working with the states to ensure that they pay retirement benefits to their retirees and also put a plan in place to review pensionable inflation.

‎‎“I mean, receiving ₦5,000 is unacceptable. I do hope it is not true. I will ask my team to confirm.

‎‎“But ultimately, what we are trying to do is get all the states into the scheme. Once you get into the scheme and start contributing to the Pension Protection Fund, the fund can protect the retirees of those who participate.”

Our Reporter

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