IGBOKWE: No Harmonised Pension Scheme In Enugu

By LAWRENCE NJOKU   |   12 September 2015   |   11:53 pm  
Enugu state map

Enugu state map

What’s the situation of pension scheme in the state?

IN Enugu State, there is no harmonised system of pension, in that, there are about three points through which pensions are paid. One is civil service, which is paid in the office of Head of Service for civil servants and secondary school teachers; the second is the primary school teachers and local council staff pension, which is coordinated from the local council pension board and the third is parastatals pension, which is paid monthly through their parastatals. Currently, the pension of civil servants and secondary school teachers is almost up to date, and that started almost few months ago, towards the end of the tenure of the immediate past regime.

Where we have problem is parastatal pensions, where retirees are owed arrears of pension, and they agitated that their subvention could not carry their pension. Some got increase, but could not pay pension and the arrears of the pension are accumulating. Some did not get their subvention, so, up till now, they are owing, while some do not have enough funds and have resorted to paying 50 per cent staff salary and 50 per cent pension per month.

Worst hit also is the local council pensions, where you have the entire primary school teachers not paid. Over time, government complained that the wage bill is not reducing, but increasing by the day, and in some cases, where people have died and their name still appearing. But I think there is a biometrics that is going on. The situation is that local council workers and primary school teachers are owed pension in this state. Parastatal workers are also owed pension. I cannot say exactly the number of months these categories of workers are owed, but it is really an issue for us, and we are working to see how government can solve the problem. Core civil servants and secondary school teachers are owed one-month arrear.

Do you think the problem arose because workers failed to embrace the new pension scheme?

Enugu has just embraced contributory pension scheme. The Pension Fund Administrators (PFAs) are currently registering people. The bill was passed in Enugu State in 2014 (Contributory Pension Bill in Enugu State) and the state shortlisted PFA and they are doing registration at the moment. The next stage at the end of this is the actual valuation to know those who are qualified. Those who have less than five years are not qualified. Those who are qualified, actual valuation will know how much they are due in the scheme, which will be transferred, so that when they retire, they will be paid what they have contributed and what they were due before joining the scheme. It is on, at the moment.

We have also called on the state government, by law, to set up the pensions bureau to run the scheme. It is a scheme that we embraced, because we knew that it would be beneficial to workers than setting aside money that you wouldn’t see tomorrow. So, instead of that, let this money be paid, bit by bit, every month, both on the side of the workers and government, and is credited into an RSA account, which is the personal account of the worker. The workers get an alert on monthly basis, about how much he or she has, so that, as the person is retiring, he is seeing his money, unlike the one you will retire and start lobbying that the money be paid to you only to be told that there is no money.

The scheme is good, and the Federal Government embraced it since 2004, and almost every Federal worker is part of it. States like Lagos, Ogun and Delta have been there. The truth is that in the next few years, no government will be ready to set out money for pension.

If they are now crying to pay monthly salary, how about pension and other challenges?

Sometimes, you find that workers retire enmasse and when they are retiring, you will discover that it is a huge burden on government, and when you don’t have provision to accommodate this level of increase, that is when arrears set in. Definitely, there are challenges, including operational and workers buying into it, and for some, workers will ask why should they contribute to it. But we are not talking of ideal, but reality. The reality is that government will soon stop setting money aside for pension. So, we should work hand-in-hand with government to prepare ourselves since government is a continuum. It is for the workers to embrace it for their own good.
Do you know why it took such time for the scheme to be embraced?

Well, there are issues over it, especially, between workers and government, and this has to do with understanding that the scheme is meant for their benefit. We have taken time to educate the workers on this. There is also the initial complacency from the House of Assembly, but we thank God that these have been finally resolved and we are now looking forward to implementing the scheme here for the workers of the state. We want them to embrace it for their own good.

And the pension board?

When you have the pensions board, it will take care of the old and new scheme and that is why we are doing the actual valuation. Once you start this, the old scheme will not be a problem again — States did not embrace it in the first time, but Enugu and Anambra are the only states in the southeast that have embraced the scheme. Very soon, the board will come on stream. We have written and spoken to government. There is stipulation of the law about it on those who will run the place. Labour will have three representatives on the board to know what is happening.



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