Retirees, experts fault delay in minimum pension implementation
Retirees and experts have faulted the continued delay in the implementation of the minimum pension guarantee (MPG) 13 years after the implementation of the contributory pension scheme (CPS).
Section 71 of the Pension Reform Act 2004 (now amended 2014) provided for the establishment of a minimum pension guarantee for all workers who have contributed for some years but have not accumulated enough to have a minimum pension at retirement.
“This guarantee comes into play when a member does not have enough accumulations to enable him to draw down a pre-specified minimum benefits; the State provides the required assistance by topping up the member’s account with the required amount. Thus, the MPG can provide progressive transfers to those with less than complete contribution histories while taking income into account to avoid some leakages,” Former Governor of Edo State, Comrade Adams Oshiomole, said at a conference on CPS implementation.
For the smooth operation of the minimum pension guarantee, Section 82 subsection 1 of the Pension Reform Act 2014 provided for the establishment of pension protection fund to provide minimum pension guarantee for contributors who have insufficient funds in their retirement savings account as at retirement.
The Act requires the federal government to fund the pension protection fund from an annual subvention of one per cent of the total monthly wage bill payable to employees in the public service of the federation and returns from pension fund investments.
The Fund is also expected to be funded from the annual pension protection levy paid by the National Pension Commission (PenCom) and all licensed pension operators at a rate to be determined by the commission from time to time.
It is expected that PenCom would have to come up with guidelines and regulations for the implementation of the minimum pension policy.
However, Daily Trust investigation showed that the PenCom is yet to determine the amount of money that should be paid as the minimum pension guarantee in Nigeria just as N18, 000 is the minimum wage approved by the federal government in Nigeria.
A source within PenCom, who asked not to be named, said the Commission