In all the presentations , I have done in pension
related matters , numbering about 3000, spanning over a period of six years in
the following sates Zamfara, Nasarawa, Abuja , Enugu, Imo , Kwara, Osun, Lagos etc in both private and public sectors, the most
re occurring question is how safe is my contribution.
The safety of any fund is the basic criteria in
setting up the fund, when a fund has no safety; it is of no use in setting it
up.
In an article by Odunze which appeared in 2011, titled “The Task of managing and safeguarding the pension fund” Odunze opined that “With the call in Europe and America for an extension of the retirement age due to the failure of the pension schemes as a result of the last global financial crises, it becomes pertinent for the pension fund administrators, the pension fund custodian and the National pension commission . PenCom to embark on stringent financial and investment strategies to put the schemes on sound footings. This becomes necessary to safeguard the pension fund”
The failures of the National Provident Fund Act of
1973, The Pension Act of 1990 and the NSITF Act of 1993 are all fresh in our
memories. The business environment is becoming more and more complicated, so
also is the human nature and behavior. They all fail because of several
reasons, which included corruption, not maintaining a good data base, not
proper oversight function, non challant attitude of the officials involved.
The Pension Reform Act 2004 clearly pointed the
provisions of Pension fund custodian, pension fund Administrator and the
National pension commission have careful delineated duties that has serves as
check and balances to the establishment, administration and running of the
schemes to make it safe and profitable to both the contributors, retirees, and
return on assets to the administrators and other stakeholders in the scheme.
The recent amendment of the 2004 Pension Reform
Act, which resulted in its repeal and the subsequent provisions of the Pension
Reform Act 2014 will positively consolidate more on the pension assets as the
relevant portions of the law has increased the coverage to states, local
governments, and employers with minimum of three employees.
There
is also the consolidation of the pension reform act as aptly captioned by the
highlights of the pension reform act 2014, it should be noted that “The Pension Reform Act 2014 has
consolidated earlier amendments to the 2004 Act, which were passed by the
National Assembly. These include the Pension Reform (Amendment) Act 2011 which
exempts the personnel of the Military and the Security Agencies from the CPS as
well as the Universities (Miscellaneous) Provisions Act 2012, which reviewed
the retirement age and benefits of University Professors. Furthermore, the 2014
Act has incorporated the Third Alteration Act, which amended the 1999
Constitution by vesting jurisdiction on pension matters in the National
Industrial Court.
Punishment
for defaulting employers
: the pension reform act in Section 11
(6) of the Act provides that an employer who fails to deduct or remit the
contributions of its employees within 7 working days from the date salary is
paid, in addition to making the remittance already due, will be liable to a
penalty to be stipulated by the Commission.
Furthermore, Section 105 (1& 2) on offences under the Act empowers the National Pension Commission (PenCom), subject to the fiat of the Attorney General of the Federation (AGF), to institute criminal proceedings against employers who persistently fail to deduct and/or remit pension contributions of their employees.
Furthermore, Section 105 (1& 2) on offences under the Act empowers the National Pension Commission (PenCom), subject to the fiat of the Attorney General of the Federation (AGF), to institute criminal proceedings against employers who persistently fail to deduct and/or remit pension contributions of their employees.
With
all these provisions, the scheme has the necessary provision to ensure
compliance and safety of the fund as pension fund custodians are expected to
have an indemnity of three times the value of their fund, in the case of
custodian going bankrupt.
Like
Jonny Walker we are not deterred by where we failed, but we set our minds on
our destination and that is why we are bent on the safety of the fund.Culled from REGINALD ODUNZE.COM ( reginaldodunze.blogspot.com)
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