Managers of the Country’s pensions under the umbrella body of Pension Fund Operators Association of Nigeria (PenOp) has requested the Federal government to issue bonds for specific infrastructure projects or buy commercial guarantees from the international market to be able to access pension funds for infrastructure.
The body believes that this is the easiest way the fund can be guaranteed safety under the present circumstances, as most other options being canvassed by government and other interests, defies the objective of establishing the Contributory Pension Scheme (CPS).
“It is important that we regularly inform the government what the purpose of the pension scheme is all about, which is to ensure that those who contribute have access to their pension at the point of retirement. We will be proud to be part of the development of the economy, using the pension funds, but we must not undermine the objective of this scheme, PenOp executive said, during a media interaction in Lagos.”
Longe Eguarekhide, chairman of PenOp said the association is concerned about the call by government and politicians on utilisation of pension funds, apart from the motive it was set up to achieve.
Eguarekhide noted that out of the N5.3 trillion pension assets accumulated in the last N12 years, about N3 trillion came from contributions, while N2.2 trillion came from investment income.
“What it shows is that the money has been active. So, the philosophy of managing this money is to add to it. It means that the money has been used profitably. It also shows that it is being used by the managers for the right objective, so that when people retire, they earn their money seamlessly.”
“If you then decide that you are going to use this money to finance projects that are not adequately thought-out, and rather than add to the money, the money either disappears, or brings no return, you then have a problem, Eguarekhide argues.
He further observed that there are investment provisions; if we find the right projects we would make this investment commitment.
Eguarekhide, who further observed that no pension money is idle, said about 70-75 percent of the fund, is invested in bonds and treasury bills, while the remaining has been spread in other asset classes.
Modestus Anaesoronye
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