Lawmakers plan law amendment to tackle pension challenges
The Chairman, house of Representatives Committee on Pensions, Mr Kabiru Rurum, has said lawmakers are planning to review the country’s pension laws to address challenges in pension scheme.
Rurum spoke during the 2021 annual PENOPS-NASS retreat in Lagos on Saturday.
he said, “The timing of this retreat is also apt as it is coming when the legislature is focusing on the amendment of the 2014 Pension Reform Act.
“The amendment aims to address some of the teething challenges currently faced by operators as well as beneficiaries. We are aware of many challenges facing our senior citizens and we are determined as a committee to find a lasting solution to them.”
he said the house was ever ready to collaborate with the association of pension operators on any matter that may require its legislative intervention.
The President, Pension Fund Operators Association of Nigeria, Mr Wale Odutola, said in the last 17 years, Nigeria’s pension industry had moved from a largely unfunded pension system to one that is fully funded, professionally managed and mainly private sector-driven.
According to him, the Contributory Pension Scheme practised in Nigeria has adopted international best practices, is technologically driven and has grown steadily over the period.
he said, “We also need to note the areas where our industry lags behind other countries. One area is the level of pension penetration. Nigeria currently has a pension penetration rate of approximately 11 per cent of its labour force.
“This pales in comparison to 19 per cent in South Africa, 20 per cent in Kenya and 77 per cent in the United Kingdom. Consequently, it goes without saying that the industry needs to deepen its level of penetration, especially in the informal sector.”
The Chief Executive Officer, Penop, Mr Oguche Agudah, said, with more than nine million retirement savings accounts across the private and public sector, many Nigerians had confidence that they could have peace of mind in their retirement years.
he said, “The annual growth of the pension assets is also impressive, growing at a compound annual growth rate of 32 per cent as at 2019, which is faster than the GDP growth rate.
“Furthermore, the pension industry has grown to become the largest institutional investor locally, driving the growth of the bond market and contributing to overall capital market development.”
A former Director-general, Pencom, Mohammad Ahmad, said that there was a need to look into the issue of minimum pension in the scheme.
he also said there was a need for the operators to explore the informal sector by leveraging technology and innovative methods to reach out to those without pensions.
“We should not joke about ethical standard because we are managing other people’s monies,” he said.
The Chairman, Senate
Committee on establishment and Public Service, Senator Ibrahim Shekarau, said the
PENOPS-NASS annual retreat had proved to be a veritable room for knowledge sharing, interactions and deep reflections on the industry.