UGWU: 2004 Pension Act Is Founded On Injustice, Fraught With Frustration

By LAWRENCE NJOKU   |   12 September 2015   |   11:02 pm  

Photo: ncsl

Photo: ncsl

How come Enugu workers have not embraced the new pension scheme that started in 2004?

THE issue of pension, as it affects Enugu State workers, is what I worked on, and which workers in the state opposed and will continue to. The condition of the retirees today is part of the continued neglect of workers’ welfare and their fundamental existence. This pension policy was not founded on any logical reasoning at all. It was founded entirely on injustice and illogicality. The contributory pensions scheme came out in 2004. Let me say that every policy must have a fundamental objective policy behind it; there must be a goal it intends to achieve, which must be based on the principle of justice, but this scheme is not in line with that. It was not founded on justice.

What it purports to achieve is to solve the hardship of retirees in the hands of government. In the contributory pensions scheme, they set out the objectives and the main reason raised there is, that over the years, a lot of money had been provided in the budget for pension of workers, but at the end of the day, it would go down the drain and nothing would be heard about it.

The pension contributory system, I took time to study it, only to discover that it was a contradiction of the problem it intended to solve. It raised a lot of moral issue for a government, which has not been able to end corruption, which now wants to use it to transfer the burden on workers.

Prior to the 2004 pension’s scheme, there had been a policy that was not contributory. Under that policy, as a worker is retiring, he is going to be paid 80 per cent of his monthly basic salary as pension, and he will be paid until the particular day that he or she dies. Even after the death of that person, the family still receives something for about three months.

Also, under the old pension’s scheme, there was gratuity, and in this, a civil servant on retirement, was entitled to 300 per cent of his yearly basic salary, and it would be paid in bulk. The practice is that, as a worker is about to be retired, he will start his retirement leave, and will be given three months, in lieu, and with this gratuity, he will start a new system in life. This is because, many civil servants retire without training their children and this gratuity helps them sustain their family.

Under the present policy, what happens is that the civil servant contributes money from his salary, with which he will pay himself. It does not end there, the very moment the person stops working, it is that very day it will end. Whatever amount will translate into your savings, is what they will give to you, but in the previous policy, the law had already defined what will be worked out. This new scheme prepares the retiree to die before his time, because there is nothing you are hoping on. This particular policy is entirely a policy of frustration and founded on injustice. It has nothing to benefit the worker.

On the other hand, when a governor retires, he will go home with benefits, including house, cars and what have you. In addition, he will continue to receive his basic salary and allowance until he dies as former governor; but the civil servant, who has worked for 35 years, when he retires, you will now work out what he will receive. That is the injustice in the whole arrangement. They removed the judiciary from it, even when they know that the scheme violates the contract of employment of workers. This has also created two pension schemes in Nigeria. Under the first scheme, everybody operated under the same umbrella and everybody received same treatment. The army, who were part of the new scheme, agitated against it, and they were removed. The Police have been removed from it, because it has nothing to benefit the worker. There is no particular interest accruable to the money, which they saved for you. If the individual saves the money for such period of time in a bank, there will be some interest on it. So, people, who are using this money, use it to run business without any benefit to the worker.

Based on the discovery, we in Enugu State, in 2008, started agitation on the matter and were able to stop the former administration from passing the bill into law. They tried it three times and workers rejected it. It was recently that they went through the back door to pass it into law. It was a connivance of some labour leaders in the state and the former House of Assembly.
But this is supposed to be managed by a board to lesson hardship encountered by pensioners?

It is part of the issues we raised in our objection. This thing started in 2004 for Federal workers and up till today, you still see the woes these workers are passing through. But beyond that, there is a simple thing that ought to have been done, and that is to put up a commission to regulate and manage it. Why should it be only when workers are contributing that you will set up the commission? Can this system offset the entire suffering of the workers?

In Enugu State, the local council has a different system. There is no pension board for Enugu State Civil service, but there is a pension board for council workers. Before now, no council worker was owed arrears in pension under the old scheme, because there was a board, however, currently local council workers are owed arrears of pension, because they have scrapped the board. So that policy has nothing to benefit retirees in Enugu State.
Are you then calling for return to the old system?

The problem is that we have a labour leadership that does not care… a leadership that neglects workers’ welfare. The Nigeria Labour Congress (NLC) was one of the bodies (people) that floated an agency to manage it and they are busy collecting from the workers. This is not fair and workers should agitate against it. Government should put up a mechanism to streamline this, so that as workers are receiving their salary, the pensioners are receiving their pensions.
Looking at the paucity of funds, where most state governments can no longer meet salary obligations, is it possible to still set out certain amount monthly for pension?

As we are talking, there are many state governments that do not owe workers as well as pension. This old scheme is as old as civil service. Pension is an allowance. Somebody does not pay himself allowance. It is an allowance paid to a retiree and beside that, how many workers retire in a year and how much are they paying these workers as salaries? How much is the basic salary of a worker in Enugu State today? In fact, a director, all he receives at the end of the month, including allowances, is not up to N100,000. If you remove basic salary from all these, you will discover that the director is not taking up to N30,000 in a month. It is 80 per cent of that N30,000 that you pay to the person and how many civil servants do you have as retirees in the year? Look at Buhari, as President, if he was not receiving pension as a retired military head of state, could he have survived all these years? This is what gives room for corruption in the system, because if somebody, who is retiring, knows that he has nothing to fall back on, he will find ways to loot. It does not solve the matter. What a governor goes home with when he retires is more than what over hundred workers will get when they retire. It is lack of fiscal management in Nigeria that has brought this problem on the workers. They did not say there was no money to pay, but that a lot of money had been voted in the past, but vanish at the end of the day. Do you know how much a legislator goes home within a month, the governors and other appointees? It is inability to have creative thinking to generate wealth and that is why government will lack money. How can a government depend on federal allocation to survive?
The bill has been signed into law and it is now operational in Enugu. Are you saying workers will not embrace it?

It is an injustice that cannot be allowed to exist. Like I told you, if you go to section 173 of the constitution, you will discover that this is not constitutional. We are going to use every legal means to stop the policy, because it contravenes the terms of employment between the workers and state government.



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