By Dotun Akintomide
The National Pension Commission (PenCom) has lamented the non-compliance of 26 states in the country to remitting fund to the Contributory Pension Scheme (CPS), in line with 2014 Rension Reform Act, saying states’ indifference towards pension matters is increasingly adding to backlog of arrears owed senior citizens.
Nigerian NewsDirect gathered, in a recent report released by PenCom where the Commission regretted that only 10 out of the 36 states in the federation had begun the remittance of contributions into the RSAs of their employees, while eight have begun funding of their Retirement Benefit Bond Redemption Fund (RBBRF). The remaining 26 states are yet to start the remittance of contributions into their workers’ RSAs or fund the accrued rights.
Since the scheme was introduced in 2004, a total number of 22 states have enlisted in the scheme, the report stated. In a bid to ensure all states enlisted, the 2014 Pension Reform Act (PRA 2014) made it compulsory for states to compulsorily implement the scheme.
Records also indicated that 673,116 contributors, who are workers of the various state governments, are registered with different Pension Fund Administrators (PFAs). Lagos, Ogun, Kaduna, Niger, Delta, Osun, Rivers, Anambra and two other states are indeed, the only states that have begin the remittance of contributions to six PFAs and are funding their accrued rights.
The remaining 26 states, PenCom disclosed, were yet to start the remittance of contributions into their workers’ RSAs or fund their accrued rights, as retirees in those states were left to their own faith.
This means that retirees in these states have laboured in vain, and had nothing to fall backs after active service, a development that have left millions in abject poverty, and in extreme cases leading to their untimely death.
Imo State, the Commission said was yet to start the remittance of pension contributions, but that the Imo State University was currently implementing the Contributory Pension Scheme (CPS), but not yet funding its accrued rights.
Zamfara State also began the remittance of pension contributions of its employees to the PFAs, but has yet to fund its accrued rights.
PenCom stated that Jigawa State had transferred its pension assets to six PFAs for management, while Kano was yet to do so.
The Director General, Lagos State Pension Commission, Mrs. Folashade Onanuga had said in an interview that unlike Lagos, other states are currently struggling to perform their obligations in line with CPS guiding rules.
“The Contributory Pension Scheme PRA 2014 has revised the rate of pension contribution (from 7.5% contributed equally by the employer and employee under the old law) to 8% for the employee and 10% for the employer; bringing the minimum total contributions for both parties to 18% compared to 15% previously.” Onanuga said.
Findings show the federal government owes up to14 months pension arrears to retired federal civil servants, while some states owe as high as 20 months. Yet there has been a reduction in budgetary funding both in the states and at the Centre, and on a larger scale a total neglect of the budgetary provision for funding of RBBRF account and the remittance of monthly contribution from 2014 till date, explaining why retirees have not be able to get their monthly pensions.
PenCom report further shows that as against the N91billion needed to offset pension arrears through RBBRF, only N50 billion was budgeted for in the 2016 national budget, leaving a shortfall of N41.71 billion.
Also, there are indications that much was not budgeted to offset pension arrears in the 2017 national budget, sources disclosed to Nigerian NewsDirect.
However, in a bid to confirm the amount budgeted for the offsetting of pension arrears in 2017 budget, as well as ask how PenCom is compelling states to fullfil their Pension remittances’ obligation, NewsDirect contacted the National Director General, PenCom, Mrs. Chinelo Anohu-Amazu, but she neither picked her call nor responded to text message sent to her line, till the time of filing this report.