Trustfund decries non-implementation of pension scheme by states

Abuja Regional Manager of Trustfund Pensions Plc., Peter Okonjo(Left); Obasi Ngozi (participant); Akpom Gilbert (participant); Trustfund Customers’ Relationship Management Officer, Maha Longe; and Gbadebo Sekinat (participant); at the Trustfund Pensions Customers’ Forum in Abuja.

Abuja Regional Manager of Trustfund Pensions Plc., Peter Okonjo(Left); Obasi Ngozi (participant); Akpom Gilbert (participant); Trustfund Customers’ Relationship Management Officer, Maha Longe; and Gbadebo Sekinat (participant); at the Trustfund Pensions Customers’ Forum in Abuja.

TRUSTFUND Pensions has bemoaned the non-implementation of contributory pension scheme by many state governments 10 years after the law was passed.

Delivering a paper titled, “Organized labour and contributory pension scheme: Experience from field (with particular reference to the states and private sector,” at the just concluded NLC leadership retreat in Calabar, Cross River State, the Managing Director of Trustfund Pensions Plc., Mrs. Helen Da-Souza, said less than 10 state governments are currently implementing the scheme.

She also hinted that state governments whose contributory pension scheme laws were passed over five years ago are also yet to commence full implementation, while many others have not even made meaningful effort to introduce pension scheme for their workers.

She said: “In spite of the fact that the Pension Reform Act 2004 extended its coverage to the state and local governments, less than 10 out of 36 states have fully implemented the Contributory Pension Scheme (CPS). Some states that have implemented the scheme have not made remittances and efforts by operators to get such state governments to remit contributions have not been fruitful. A significant number of these states are known to be defaulting in the payment of staff salaries.”

While commending labour unions for their untiring efforts at ensuring workers enroll in the scheme, Da-Souza traced the high number of workers that are participating in the Scheme to the efforts of the Nigeria Labour Congress (NLC) and Trade Union Congress (TUC).

She highlighted that labour has particularly contributed to the growth of the scheme by continually enlightening and mobilization of workers.

The Trustfund boss urged Pension Fund Administrators (PFAs) to forge close collaboration with labour to get workers registered in the scheme.

She explained: “PFAs must work or partner with union leaders in each organization, especially companies, to get the employees registered. In the course of the partnership, the union officials ask basic questions and extract commitment for quality service from the PFAs before making any recommendations. Occasionally, union officials conduct enlightenment fora to ensure that workers have a proper understanding of the dynamics of the PSC prior to enrolment.”

Da-Souza insisted that labour is key to enforcement on the part of employers, saying, “it is common knowledge that a large number of employers would ordinarily not want to comply with the Pension Reform Act 2004 but for labour intervention. This has helped a great deal in improving participation by the private sector.

While stressing that there are still misgivings, misconceptions and apprehensions about the CPS, the Trustfund boss blamed knowledge gap and ignorance about how the system works for the unhealthy development.

She added: “Despite the fact that the law stipulates the rate of contribution, some employers pay arbitrary amounts convenient for them rather than compute the rate on the gross salary (gross salary is basic, housing, and transport allowances), while others reduce the components of the gross salary to enable them to achieve convenient/predetermined deductions.



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