For the country’s pension sector to achieve the expected growth and penetration, particularly in the informal sector, strong economic growth and job creation are critical.
Folashade Onanuga, former director general, Lagos State Pension Commission (LASPEC) made the remark at the 2023 Certified Pension Institute of Nigeria (CPIN) Investiture, Induction Ceremony of new Fellows, Associates held in Lagos.
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She said that the low level of awareness and high rate of unemployment are responsible for present low pension coverage.
She submitted that any society that does not plan for the elderly will eventually end in crisis, stressing that pension industry players and all stakeholders should continually innovate to ensure that activities and policies as it relates to pensioners are harmonised to be in line with present day realities.
Onanuga also decried the level of pension assets to the country’s Gross Domestic Product (GDP), which is little over 7.8 per cent, stating that the pension assets stood at N17.29 trillion, which is relatively large in absolute terms, but when compared to the country’s GDP it is very low.
She submitted that inflation and high interest rates have eroded the value of money and this poses a significant problem in the money market.
According to her, when the rate of inflation surpasses the interest earned on pension assets, contributors would find that their retirement income is insufficient to support them in old age.
The pension guru, whilst proffering solutions to the challenges clogging the industry’s growth, called for government’s interventions and commitment to the scheme.
She also noted that there should be employers’ cooperation; public education, building stakeholder confidence and regular policy review.
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Umaru Kwairange, president/chairman of Council of CPIN in his welcome address, said the institute would continue to improve on professionalism in order to meet the yearning of Nigerians and promote the development of pension administration in Nigeria.
