A new move by the National Assembly to exempt its staff from the country’s Contributory Pension Scheme (CPS) and manage its personnel’s pension scheme through a board has shocked many Nigerians.
People are surprised that a National Assembly that is supposed to defend and protect the law and drive government institutions towards efficiency and growth, would come to desecrate a pension system (CPS) that has showed transparency, accountability and value for workers in Nigeria.
This is coming on the heels of a bill by the National Assembly seeking to amend the Pension Reform Act 2014 to exempt its personnel from the CPS and establish the National Assembly Service Pensions Board. The bill passed a second reading on Thursday.
Titled, “Bill for an Act to Amend the Pension Reform Act, 2014 to Exclude/Exempt the National Assembly Service from the Contributory Pension Scheme and Establish the National Assembly Service Pension Board; and for Related Matters (HB. 2025)”, which was sponsored by Hon. Olododo Cook, chairman, Committee on National Planning and Economy Development.
Agudah Oguche, chief executive officer of the Pension Fund Operators Association of Nigeria (PenOp) said, arguably, one of the most important, encompassing and development oriented bills in the history of Nigeria is the pension reform act 2004, which was revised in 2014.
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Oguche said the act brought all pension matters in Nigeria under one umbrella, unified the various pension schemes, brought transparency and professionalism to pension operators in Nigeria and moved pension administration to private sector fund managers.
“It is a bit baffling why anyone would want to exit such a system and place extra burden on the already strained finances of the government, Oguche said.
“With any act, law or process, there is always room for improvement, and we are very much open to that, but to exit totally and create a parallel system will only promote inefficiency, and open the door to opacity, which fuels corruption.”
According to him, “The thinking behind the bill is not well thought through in our view and does not take into account the funding of the structure being proposed. There is no point in passing a bill when little provision is made towards funding. We already have so many of that already and we cannot afford to have more of that.”
Cook in his lead debate, had said the bill will create a new board saddled with the task of administering the pension’s scheme for personnel of the Service.
Cook said: “The proposed amendments provide that there is established a Pension Board (in this Bill referred to as ”the Board’) which shall be charged with the responsibility of managing payment of pensions and gratuities to all personnel of the Service. The bill shall apply to all personnel of the National Assembly service including those who had retired before the commencement of this Bill. The retirement benefits of personnel referred to in subsection (2) shall be adjusted to be commensurate with the provisions of this Bill. There shall be charged on and paid out of the Consolidated Revenue Fund of the Federation, all such sums of money as may, from time to time, be granted by the Federal Government by way of pension and gratuity in accordance with this Bill.
The nation’s pension assets as at the end of April 2021 stood at N14.06 trillion according the latest monthly figures of performance of the industry released by the National Pension Commission (PenCom).
The figure rose from N13.88 trillion recorded at the same period in March 2022, indicating 181. 34 billion increase month-on-month, as against N113.75 billion increase in March from February performance.
The number of registered contributors also grew to 9.64 million (9,648,213) in April, against million 9.30 million in March and 9.27 million in February 2022.
Femi Gbajabiamila, speaker commenting had said the bill when passed into the law will not remove the parliament from the aprons of the executive. In a similar development, the House had also approved a Bill to make provisions for retirement age of staff of legislative houses in Nigeria.
The House made the approval while considering the bill by Hon. Wole Oke at the Committee of the Whole.
