Declining Activities at PenCom

Ebere Nwoji reports that the lull in activities at PenCom, especially those aimed at educating Nigerians on the Contributory Pension Scheme, is a major source of worry for pension industry stakeholders

The National Pension Commission (PenCom) was established at a time Nigerians were helpless about pension fund management.

Negative reports on pension matters had dominated the pages of newspapers as well as the radio and television discourse programmes. Also, activities of government appointed pension fund managers at state and federal levels, left the Nigerian workers with bleak future due to fear of what will become of their retirement.

Indeed, pensioners’ condition was hopeless while there was almost N3trillion deficit on pension account.

But the establishment of PenCom and the Contributory Pension Scheme (CPS), under section 17 of the 2004 Pension Reform Act, rekindled the hope of Nigerian workers . Indeed, Pension Fund Administrators (PFAs) whose activities were under the purview of PenCom attributed their success to the commission’s effective regulatory functions.

Confirming this and commending the efforts of past administrations in PenCom, the General Manager, Business Development of Radix Pensions, Kunle Adeboye said: “Kudos must go to PenCom in terms of regulation. If you look down the road, you could see that it has been a smooth sail for every PFA in the industry, mainly because of effective regulation by PenCom. If not for regulation, people would have been cutting corners doing things as they like.

He added: “PenCom had guarded against it over the years. If there should be a change in the system, is in the area of education and awareness creation and PenCom is dong excellently well in that area. The Commission has put in place micro pension scheme. It organises enlightened campaign and workshop for contributors and the entire public”. Similar testimonies about the commission’s effective supervisory role, which has led to accumulation of over N7.5trillion were also given by other pension fund administrators.”

The commission was not only alive to its responsibility of guarding against misbehaviours and mismanagement of the pension funds by the Pension Fund Administrators,(PFAs) the Pension Fund Custodians(PFC), but was also active in carrying out public awareness programmes targeted at enlightening Nigerians including government at all levels on the sacrosanct nature of the pension fund and assuring the contributing workers that their money is safe and profitably invested in the right portfolios.

The commission, also made it clear to some voracious politicians seeking for free funds that the much talked about N7 .5 trillion pension assets was not in any bank’s vault as assumed by the proponents of investment of the funds in infrastructural development.

The commission, during the era of its pioneer Director General, Muhammad Ahmad up to the regime of its immediate past Director General, Chinelo AnohuAmazu, was bubbling with activities and information dissemination on programmes that kept Nigerians abreast with relevant issues in the pension domain. But today, the reverse seems to be the case. The public is bereaved of information on activities in the commission, among PFAs and even on the investment of the much cherished pension funds.

Indeed, since the exit of the immediate past Director General of the commission, Nigerians have not heard about the quantum of pension assets accumulated or about the activities of recovery agents set up by the former DGs of the commission to compel errant employers remit their employees’ funds.

Even the much talked about micro pension scheme has been buried under the regime of the current Director General, while the pressure on federal government to pay the outstanding accrued rights of its workers for onward transfer to their Retirement Savings Account has been doused.

In recent times, the latest information heard about the CPS was on sponsorship of multiple private bills on exemption of some government agencies from the scheme sponsored by various interest groups in the National Assembly.

But for the efforts of the Pension Operators Association of Nigeria (PenOp) and other interest groups, proponents of the bill would have had their way and the CPS scattered as the Aisha Dahir-Umar led PenCom, could not eloquently defend the course of the commission and that of Nigerian workers under the commission’s umbrella during the recent public hearing on the bill.

Against this backdrop, the sector observers, have raised the question as to what has become of PenCom; they have also asked whether the commission is still in charge of regulating pension activities in the country or not and how much has been contributed under CPS in the past one year, they also doubted the effectiveness of PenCom’s regulation of PFAs’ activities querying whether PFAs are still under PenCom’s control or whether things have gone amiss in the sector. Questions are also being asked on the efficiency or not of the present leadership of the commission and whether we now have a square peg in a round hole type of administration in the commission?

Answers to these questions and more have become necessary given the fact that before now, Nigerians on monthly bases get information on monthly or at worst quarterly progress on pension assets accumulation as well as investment pattern of the funds.

Today, the public is kept in the dark on these information. Even information on the commission’s effort to ensure payment of outstanding accrued rights of workers is not available even the media is not aware of whether government has cleared the outstanding accrued rights of its workers or not.

The most pathetic part of it all is the fact that hope of sweeping every Nigerian worker especially the self-employed under the CPS through the micro pension scheme seem to have been dashed as plans to this effect initiated by Dahir- Umar’s predecessors seem to have been relaxed.

Also the much awaited window transfer which the former regimes in the commission promised to kick off has been laid to rest by the current administration as nothing has been heard about it while efforts to that effect seem to have been put on hold.

The commission has as part of its functions; regulation, supervision and ensuring the effective administration of pension matters in Nigeria.

The commission was also assigned the responsibility of issuing guidelines for the investment of pension fund, approving, licensing, regulating and supervising pension fund administrators, custodians and other institutions relating to pension matters as the commission may, from time to time, determine

It also has the responsibility of establishing standards, rules and guidelines for the management of the pension funds under the Act, ensuring the maintenance of a National Data Bank on all pension matters, carrying out public awareness and education on the establishment and management of the CPS, promoting capacity building and institutional strengthening of pension fund administrators and custodians, receiving and investigating complaints of impropriety leveled against any pension fund administrator, custodian or employer or any of their staff or agents among others.

In recent times the commission, has been too relaxed in carrying out these functions especially in the area of public awareness and education of the masses through activities that create room for public discourse on pension matters.

For instance, all through last year, the periodic stakeholders’ workshop and enlightenment campaigns organised by the commission in different parts of the country did not hold. Even this year, it is not certain that the annual pension summit, which attracts pension stakeholders across West Africa to Nigeria will hold.

Also efforts to get more state governments to key into the CPS has been put on hold while the status of some state governments which have started their journey into the scheme is not known.

This being the case, there is the tendency that zeal by state governments to key into the scheme will die down since there is no pushing force to accelerate their speed in completing the conditions and processes of fully keying into the scheme.

The result of this will be that expected increase in the assets of the scheme will slow down while the anticipated growth in the economy as a result of availability of the long term fund provided by the scheme will hardly come.

Against this backdrop, industry critics have sent a wake up call to the commission, challenging the current administration to lift up the flag of her predecessors in the commission which is currently on the ground, especially in the area of awareness creation on the CPS, which is still very new in the country and desires widest publicity, awareness creation and education of the masses.

There is fear that the current trend of look -worm attitude towards its responsibilities adopted by the present administration in the commission, if allowed to continue, would waste the efforts put in place by pioneer administration in the commission and retrogress the progress already achieved in the scheme.