Lagos State Governor, Akinwunmi Ambode
THE FULL COMMITMENT OF THE LAGOS STATE GOVERNMENT TO PENSIONERS,
PENSION REFORMS, AND PENSION OBLIGATIONS
BEING THE REMARKS DELIVERED BY DR. AKINTOLA, BENSON OKE, FCGP., FCARB., FNIM., THE HONOURABLE COMMISSIONER, LAGOS STATE MINISTRY OF ESTABLISHMENTS, TRAINING AND PENSIONS ON FRIDAY, JUNE 8, 2018 AT THE 14TH RETIREMENT BENEFITS DOCUMENTATION SEMINAR ORGANISED BY THE LAGOS STATE PENSION COMMISSION (LASPEC) AT THE ADEYEMI-BERO HALL, THE SECRETARIAT, ALAUSA, IKEJA, LAGOS STATE FOR EMPLOYEES WHO ARE DUE TO RETIRE FROM THE LAGOS STATE PUBLIC SERVICE BETWEEN JULY AND DECEMBER, 2018.
The Chairman & Members of the Lagos State House of Assembly Committee on Establishments, Training & Pensions;
The Head of Service;
The Director-General and Officers of LASPEC;
The Representatives of the Pension Fund Administrators and Insurance Companies;
Our Retirees, the Celebrants of today;
Gentlemen of the Press;
Distinguished Ladies and gentlemen.
1. The Lagos State Government under the able and effective leadership of His Excellency, Mr. Akinwunmi Ambode, has long demonstrated its full and unalloyed commitment to its pensioners, to the government’s pension obligations and to the implementation of all the provisions of the Pension Reform Act of 2004. Today, I am here to re-state, on behalf of His Excellency, Mr. Akinwunmi Ambode, the continuing and irrevocable commitment of this present administration to the welfare of pensioners, the dutiful discharge of pension obligations, and the regular reform and retooling of the governments pension systems from time to time and as the exigencies of the times may demand.
2. I am also here to offer hearty congratulations to officers of the Service who are scheduled to retire in the second half of year 2018. It is no mean feat to reach the age of retirement in health and to retire honourably from service. I am certain that you can take pride in your contributions to the development of our dear state over the years. Our dear state is much better because you served, and your services are deeply appreciated.
3. Furthermore, today also presents another occasion for us to commend the leadership and staff of the Lagos State Pension Commission for faithfully and diligently pursuing its mandate as a regulator and manager of the pension obligations and assets of the Lagos State Public Service. As I have mentioned in the past, LASPEC is the vehicle through which the Lagos State Government has severally demonstrated its virtuous moral compass.
4. Over the years, LASPEC has dutifully carried out the objectives of the Lagos State Contributory Pension Scheme Law. LASPEC’s stewardship of the trust assigned to it has been chiefly responsible for the several accolades and awards that Lagos State has won over the years. Furthermore, LASPEC has also been responsible for the fulfilment of the wider objectives of the Law as espoused under section 4 of the Law. These include:
(a). the assistance of all persons in the employment of the State Government to save towards their retirement;
(b). ensuring that persons who leave or retire from the Public Service of the State receive their terminal or retirement benefits as and when due;
(c). establishing and monitoring the adherence to the rules and regulations for the administration and payment of retirement benefits in the Public Service of the State;
(d). establishment of the group life policy in respect of death benefits for employees who die while in service;
(e). administration of Retirement Bonds for employees with past service benefits; and
(f). the establishment and maintenance of the Redemption Fund from which the liability of the bond payments would be made.
5. Today’s event marks yet another indication that the Ministry of Establishments, Training and Pensions, operating through LASPEC, remains committed to pursuing not only the objectives of the law setting it up but also the welfare of the officers of the public service for whose benefit the law was made.
6. Without re-litigating or pre-empting the excellent deliveries by the Guest Speakers, I wish to briefly reiterate the convictions that ought to be deeply appreciated and kept in view by all the stakeholders in the pension administration system. These convictions relate to the holistic and multiplier benefits that a properly managed and administered pension system has to offer all stakeholders. I propose, therefore, to briefly address in a panoramic manner, the general benefits of the enabling law that anchors the Lagos State Government’s award winning pension system.
7. First, the Lagos State Pension Reform Law allows for the maintenance of a Retirement Savings Account by each employee, which gives the workers responsibility over their retirement savings. Pensioners will no longer be at the mercy of employer, and participants are assured of regular payment of retirement benefits.
8. Furthermore, workers could choose how to allocate their retirement savings and diversify their investments over a range of investment instruments. It is also argued that personal accounts would provide all workers a higher rate of return than can be paid under the Direct Benefit plan. This approach also affords participants an opportunity to pass wealth to survivors in the event of death.
9. In addition, RSA maintained by millions of workers tend to generate massive long-term funds, which are available for investment. Owing to economies of scale, the cost of investing such funds tends to be relatively lower than if an individual worker were to undertake the investment on his or her own account. Finally, having a pension scheme that pays out benefits in the form of a life annuity affords workers with protection against longevity risk, by pooling mortality risk across others.
10. On a holistic note, the provisions of the law encourage labour market flexibility. The worker is free to move with his account as he/she moves to another place of employment and/or residence. In this way, it is an important tool for enabling workers and employers to adapt to changing circumstances especially in a global environment in which change is a constant aspect of social and economic life.
11. The government also stands to enjoy benefits under the law. The law will stem further growth of pension obligations and provide a platform for addressing this liability. It will also impose fiscal discipline in the budgetary process because pension obligations would be accurately determined.
12. Also, the health of the economy is always a major concern of the government. Thus, aside from the law’s potential to promote national savings and by implication, economic growth, funded pension schemes have the capacity to promote capital market development. Moreover, it is often argued that funded schemes have the capacity to promote economic reforms generally.
13. In the implementation of the schemes by the Lagos State Government through LASPEC, it is on record that the following successes, among others, have been recorded:
(a) In spite of the onerous funding obligations under the Contributory Pension Scheme, the administration of Governor Akinwunmi Ambode has been dogged in meeting the funding obligations;
(b) The State Government has never failed to remit monthly contributions into the Retirement Savings Account of workers and has paid more than N37billion so far into the Retirement Savings Accounts of those that have retired since the inception of this administration; and
(c) The Lagos State Government has also been consistent in setting aside funds for the payment of accrued rights as provided for in the Pension Reform Law such that about 9,045 have had their accrued pension rights paid.
14. With the institution of such elaborate schemes by the Lagos State Government, it is not surprising that retiring public officers now look forward to retirement with more confidence and joy. This is how it should be. Furthermore, let me assure you that the Lagos State Government through LASPEC will continue to ensure that public service retirees not only get what is due to them statutorily, but also continue to receive, through other agencies and programmes, further and additional support and assistance that will add value to their lives in retirement. Among others, this commitment is in fulfilment of the declaration by His Excellency who, in his Inaugural Speech said: “I shall run an open government of inclusion that will not leave anybody behind. No matter your age, sex, tribe or any other status as long as you reside in Lagos, we will make Lagos work for you”.
15. Once again, I am delighted to be at this event. I wish to thank our partners, the Pension Fund Administrators and Annuity Providers. We look forward to many more years of mutually-beneficial relationship.
16. Finally, I congratulate the 1,200 retirees and I enjoin you to take full advantage of this seminar by paying attention to pieces of advice that will be dispensed. I wish you all many blessed and peaceful years in retirement.
17. Thank you for your kind attention. God bless.
Dr. Akintola, Benson Oke, FCGP., FCArb., FNIM.
Honourable Commissioner, Lagos State Ministry of Establishments, Training and Pensions
Itesiwaju Ipinle Eko l’o je wa l’ogun.
Friday, June 8, 2018