Pension

PenCom urges state govts to mitigate huge pension liabilities with CPS

Mrs Anohu- Amazu

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Chuks Udo Okonta

The huge liabilities which usually build up in the old Defined Benefits Scheme can be mitigated by the adoption and implementation of the Contributory Pension Scheme (CPS) by States in the Federation, the Director-General, National Pension Commission (PenCom) Mrs Chinelo Anohu-Amazu, has said.

She disclosed this today at the commencement of payment of retirement benefits under the Contributory Pension Scheme (CPS) in Kaduna, stressing that the current economic challenges also provide an opportunity to implement strategies for effective financial management by the States.

She noted that the CPS provides a mechanism for eliminating these liabilities while the regular contributions into the scheme are undoubtedly less burdensome.

“I wish to assure all States that the Commission would continue to provide all necessary support towards full implementation of the CPS. We have also empowered our Zonal Offices in the six geo-political Zones of the country to collaborate with the State Governments in that regard. In addition, we are also working on the introduction of the Micro Pension initiative to serve the informal sector of the economy which is dominant in States nationwide,” she said.

The Executive Secretary of the Kaduna State Pension Bureau, Dr. Dan Ndackson, said the Contributory Pension Scheme Law was introduced in the state in 2007, but the contributions commenced in March, 2008, and that implementation was not in total conformity with the provisions of the law

“As we commence the payment of pension benefits under the Contributory Pension Scheme in Kaduna State today, we are hopeful that this would mark the beginning of the end to delays in accessing pension benefits in Kaduna State. We are committed to the change process in pension administration in the State and we count on your cooperation in making this come true.

“We however expect a surge in the payroll for pensioners on the Defined Benefits Scheme in subsequent months due to the large number of people who retiredtowards the end of 2016 to avoid falling into the Contributory Pension Scheme whose files are yet to reach the Bureau for processing and inclusion in the payroll.

“Unless MDAs and LGAs forward the files of all retirees under the Defined Benefits Scheme to the Bureau for processing in good time, our pension payroll may continue to rise throughout 2017. Conversely, we were not able to find many retirees under the CPS in the first quarter of 2017 due to the rush to take early retirement in 2016 especially by such people,” he said.

He stressed that one of the major challenges facing the implementation of the CPS in the State is ignorance, adding that despite the introduction of the Scheme in the State since 2007, majority of workers in the State, irrespective of their levels, remain ignorant about how the Scheme works.

“Consequently, the Bureau commenced aggressive sensitization on radio, television and face-to-face at MDAs and Local Government Areas as from November last year. The Bureau has also mapped out a programme to assist MDAs in complying with the provisions of the Law as from January, 2017,” he added.

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