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

is yet to work out the modalities for the minimum pension guarantee.

“It’s being worked on but at the moment, there is nothing on board on minimum pension,” the source said.

The source said there is no guideline on it yet, implying that retirees with insufficient balance in their accounts would not benefit from minimum pension as provided for in the law.

Another source in a Pension Fund Administrator (PFA) told the Daily Trust that PenCom had in 2016 instructed PFAs to remit 3 per cent of their profit before tax into the pension protection fund in readiness for the commencement of the minimum pension guarantee.

The source could not confirm if PFAs had complied with the directive, but disclosed that there were complaints that the percentage to be remitted was seen as high by the PFAs.

The source, who is an expert in pension administration, said the delay affects payout to retirees.

The source said the PFAs pay retirees en bloc if their savings are insufficient to guarantee monthly pension.

A retiree, Mr. Ola Adediji, told the Daily Trust that retirement payouts under the CPS are smaller than what it used to be under the old defined pension scheme where retirees were also entitled to gratuity.

Adediji, a member of the Nigeria Union of Pensioners (NUP), said the introduction of the CPS impoverished retirees, especially federal government retirees and the delay in implementation of the minimum pension guarantee meant that those at the bottom layer of the working population would fall little to fall back on when they retire.

“It will affect the messenger, cleaners and low level staff on small salaries. If your pay is small, your contributions in the retirement savings will also be small. Meaning that when you retire, you will have little as pension,” he said.

Another pensioner, Ugochukwu Ozondu, said workers are beginning to fear that they may not save up enough money in their retirement savings account by the time they retire and this explains why some workers are against the CPS at the state level.

Ozondu said the minimum pension guarantee is one way of assuring them that their future is secured no matter how little their contributions are at retirement.

It is important to note that the fiscal requirement for the minimum pension guarantee is shouldered by the government in other jurisdictions.

Oshiomole cited example with Chile where the provision of minimum pension guarantee is a permanent cost to the government.

Presently, more than 11 per cent of retirees receive a minimum pension guarantee benefits, which cost 0.1 per cent of GDP in Chile.

Similarly in the UK, government ensures that that pensioners will not have less than a certain amount to live on, this amount is known as the minimum income guarantee. If your income from all sources, i.e. state pensions, private pensions and investments, adds to less than the MPG then you are entitled to receive income support from the government.