Osun, Lagos listed among 10 states remitting funds into employees retirement accounts

Osun, Lagos and Kaduna are listed among the 10 states remitting funds into the Retirement Savings Accounts of their employees out of the 26 states that have enacted their Pension Reform Law, investigations have revealed. The 10 states that have yet to enact the law have also failed to remit the pension funds. “Ten out of the 36 states have commenced remittance of contributions into the RSAs of their employees.

Similarly, eight state governments have commenced funding of their retirement benefit bond redemption fund accounts,” PenCom stated. The records also showed that 673,116 contributors, who are workers of the various state governments, were registered with different PFAs.

According to the report, Lagos, Ogun, Kaduna, Niger, Delta, Osun, Rivers and Anambra states have commenced the remittance of contributions to six PFAs and were funding their accrued rights. It explained that Imo State had yet to commence remittance of pension contributions, but that the Imo State University was currently implementing the Contributory Pension Scheme but not yet funding its accrued rights. Zamfara State has also commenced remittance of contributions to the PFAs but yet to fund its accrued rights.

PenCom stated that Jigawa State had transferred its pension assets to six PFAs for management, while Kano had yet to transfer its assets to the PFAs. According to the report, the remaining 26 states have yet to commence remittance of funds into their workers’ RSAs or fund their accrued rights. The commission also said it conducted on site reviews of some self-funded government agencies to assess their compliance level with the Pension Reform Act, 2014, adding that the assessment process was expected to ensure full compliance by the relevant agencies.

PenCom introduced some guidelines to the pension administrators for registration of state and local government employees to enable them to adopt suitable structures for the implementation of the CPS. Part of the objectives of the guidelines is to ensure complete coverage in the states in the shortest possible time.

According to the guidelines, the law gives concession to the states and local governments to implement the structured approach to the registration of their employees. Both levels of government are expected to select a number of PFAs and allocate their Ministries, Departments and Agencies to each, while the employees are to freely register with the PFAs. The Director-General, PenCom, Mrs. Chinelo Anohu-Amazu, said while some states had adopted the CPS, many had yet to fully implement it.

The situation, she explained, had denied the states of the advantages of the contributory pension model, including its sustainability as a system, robust framework that eliminates the incentives for corruption in benefits administration, and ability to access the pool of investible pension funds to drive economic and infrastructural development in their respective domains. Anohu-Amazu stated that the scheme had so far delivered all the major objectives of the reform, adding that since its establishment in 2004, there had been no case of malpractice recorded in the administration of the CPS.