Contributory Pension Scheme: Retirees now access monthly pay with ease
Retirees under the Contributory Pension Scheme (CPS) have confirmed receiving their monthly pensions regularly and promptly, outliving the biggest challenge that confronted the old pension scheme.
They however begrudge the documentation process and bureaucracy faced at the point of filing for retirement, particularly those who decided to move from their current Pension Fund Administrators (PFAs) to annuity with insurance companies.
While it is obvious that early retirees in the scheme have not saved enough from the commencement of the scheme in 2004 to guarantee substantial amounts in savings, the retirees however wish they had contributed longer before their retirement, which would have enabled them to enjoy bigger pay-out in retirement.
The retirement funds in retirement are the Programme Withdrawal managed by PFAs and retiree life annuity managed by life insurance companies, respectively.
Joe Oda, who retired in 2015 as a director in an educational training institute in one of the financial services sub-sectors, is happy with the regularity of his monthly pension.
Having chosen to do annuity with one of the insurance companies, he says he gets his monthly pensions by the 14th day of every month, even ahead of 18th signed in his contract paper with the insurance company.
“For now, I have not had any delay or reason to complain. They are keeping to their terms of the contract and I commend them for that,” he says, noting that it is only one or two occasions in a year that he experienced little delay, and that was when the insurance company was doing verification.
Oda’s experience was during documentation, when his PFA was reluctant to let him go for annuity, and therefore asked for much unnecessary documents, he notes.
“I had the experience of staying all day in the PFAs office in more than two occasions, like so many other people who came for the same reason of transfer of their funds, and I think that was just a way to frustrate us so that we could change our mind not to move our funds, he states.
Oda, who also had the same experience during his wife’s retirement four years after with a different PFA, was not happy with the experience, saying it is a common practice for most PFAs.
“I think we had an advantage of knowing what to do, and also knowing people we could contact to solve our problem. What of those who don’t know so much or anybody they could contact to help them? How can you imagine that elderly men and women above sixties would be asked to go and get a last pay slip, affidavit and so many other things, maybe in Lagos when the PFAs know they retired in Abuja or other places,” Oda says.
Another retiree, who will not want her name mentioned, retired from the Federal Ministry of Education in 2019, after rising to top position in Federal Government College in the suburb of Lagos.
She is also happy with the regularity of her monthly pensions since she began receiving it late 2020.
“I receive my pensions every 16th of the month, even though I had signed with my insurance company for every 22nd.”
Her concern, beyond the documentation process of moving her funds from her PFA to an insurance company for annuity, is the amount she receives monthly. “What I received monthly is ridiculous, when you compare my earnings with my retired colleagues who left service at the same level as me before the CPS commenced, they earn better,” she says.
She however calls on the government to remember retiree annuitants when it starts to implement the planned Minimum Pension Guarantee as provided for in the Pension Reform Act 2014.
The main objective of the CPS is to ensure that every person that worked in either the Public or Private Sectors in Nigeria including the self-employed persons receives his/her retirement benefits as and when due.