Pensions: Need for Dialogue in Edo
Prior to the advent of the contributory pension scheme in 2004, it was a common sight seeing public officials shedding tears at public functions decrying the plights of pensioners. Year in year out pensioners groaned all over the country of their inability to get their entitlements.
Series of engagements by organised labour with the then President Olusegun Obasanjo led to the pension reforms that metamorphosed into the contributory pension scheme.
Effectively from July 01, 2014, the Pensions Act which governs and regulates the administration of the contributory pension scheme for both the public and private sectors came into effect in Nigeria. The Act encourages participation in the contributory pension scheme which applies to two categories of employees. These categories comprise of all employees in the public sector and those in private Organizations with employees numbering 15 and above.
There is also a provision for Private Organizations with less than three employees based on guidelines issued by the National Pension Commission (PenCom). Under the Act, both employer and employee are required to make a minimum of 10% and 8% respectively of the employees monthly emoluments. There is a review of the definition of ‘monthly emoluments” to mean the total emolument defined in the employees’ contract of employment provided it is not less than the total of the employee’s basic salary, housing and transport allowance.
Pension funds can be invested and this includes specialist investment funds and other financial instruments as approved by the Commission. There are penalties for offences of misappropriation of funds, reimbursement or payment by a Pension Fund Administrator (PFA) or Pension Fund Custodian (PFC) to a staff, officer or director. In situations where the PFC fails to hold funds to the exclusive preserve of the PFA and PenCom or where it applies the funds to meet its own financial obligations, the Act will sanction such appropriately. These are safety nets put in place in the law to safeguard investments of Civil Servants.
The governor equally explained that the state government has set up a technical committee which is expected to create a smooth take off of the scheme. According to him, members of the committee are drawn from the state government, labour and representatives from PFMs.
The Governor however, called on workers and other relevant stakeholders to support government in the actualization and realization of this scheme for the benefit of all. While labour on its part is accusing government of “not following the due process of law and legal procedure in the implementation of the Pension scheme.” Labour rising from its SEC-in session issued a strike notice to government. It itemised a plethora of other demands not connected to the pension scheme and noted that it was open to dialogue on how to effectively implement the Contributory Pension .scheme in the state.
From all indications, all is not yet well with the smooth take-off, but the question to ask is: does Governor Godwin Obaseki mean well for workers in the state? The answer is yes. The Governor mean well. He has actually commenced the payment of Pension arrears he inherited from previous regime. Those who never expect it to happen confirmed that they received alerts for their gratuity (pension lump sum), one of them said without lobbying anybody in the new government. That goes to show that the governor truly mean well for workers and pensioners in the state.
It is also pertinent to note that While reviewing the journey so far in the administration of the Pensions Act in Abuja last year, stakeholders in the sector which included labour, employers and others major players pointed the way forward for the continued robust implementation of the scheme. The review showed huge success in the implementation of the scheme nationwide.