Reps hurrying to amend Pension Reform Act 2014 in the ‘dark’- Stakeholders

A recent bill by the House of Representatives to amend the Pension Reform Act 2014, to exempt personnel of the National Assembly Service from the Contributory Pension Scheme (CPS) and to establish the National Assembly Service Pensions Board, without following due legislative process of public hearing is like playing a game in the ‘dark’, industry stakeholders have said.

According to the stakeholders, how can legislators who have been part of bill amendments, especially the Pension Reform Acts, carry out a new amendment in their favour, without carrying the public along even for a mere hearing.

The proposed legislation 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)’, was sponsored by the chairman, committee on national planning and economy development, Olododo Cook.

Cook said the aim was to exit the National Assembly Service from the contributory pension scheme under the Pensions Reform Act, 2014, and the board when established, would be charged with administering the pension scheme for personnel of the National Assembly Service.

“We are not convinced that this bill was passed in “good” faith. We also believe that an important bill of this nature should go through the standard and due legislative processes. One of such processes is the convening of a public hearing where all stakeholders that are affected by the bill are invited to discuss and engage, a player in the industry said.

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According to people who are familiar with the issue, critical stakeholders like the workers union, labour, the pension fund operators, the regulators, employers of labour and others were not engaged in the process.

“We are also aware that some principal officers of the House who normally should oversee the passage of bills were unavoidably absent, bringing the integrity of the process into question. We are forced to question whose interests this bill is geared to serve.”

“It needs to be ascertained, why the bill was passed without the crucial input of citizens and stakeholders? This breach of sacrosanct legislative processes and the rather hurried passage of this bill, triggers serious concerns and should be revisited urgently in the interest of National Assembly staff, the pension industry and the nation in general”, said one of the key players in the pension industry.

“As a matter of fact, there are a number of proposed amendments to the current pension act that have been proposed within the House for a number of years. So, for this bill to pass quickly, while the others left unattended to, speaks to ulterior motives.”

“It is pertinent to note that the Federal Government had earlier issued a white paper stating that the Nigeria Police Force or any other government agency should not leave the contributory pension scheme as the scheme was the Federal Government’s way to have structured and sustainable pensions for its employees.”

“Furthermore, economic analysis and actuarial reports have shown that it would be impractical and irresponsible to move the police or other sectors of the Federal Civil Service from the current Contributory Pension Scheme (CPS) to a Defined Benefit Scheme (DBS) because of the amount of funds this would cost, the fiscal position of the government and the effect it would have on future retirees.”

“So, this makes this recent bill to exit the National Assembly staff quite puzzling and at a cross purposes with the fiscal situation of the country or the stated position of the executive, ” an industry analyst said.

Nigeria’s pension industry has grown over the last 18 years since the Pension Reform Act (PRA) was initially enacted in 2004. The industry has ensured that the average Nigerian worker is able to retire in peace and dignity. The act brought about the professionalisation of pension fund administration and the growth of the pension industry in Nigeria. There are many gains that the pension industry has achieved and there is a great need to protect these gains from individuals seeking personal gain.

Over the last number of years, we have seen many actors try to reverse these gains, usually from seeking to amend the act that would allow groups of people to leave the scheme. These acts are typically done through legislative actions as certain groups sponsor bills to exit the Contributory Pension Scheme (CPS).

The proposed amendments provide that there is established a Pension Board (in this bill referred to as ‘the Board’) which shall be charged with managing the 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 sub-section (2) shall be adjusted to be commensurate with the provisions of this bill.

They 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.

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