Speech by President Pension Fund Operators Association of Nigeria Umar Mairami at the PenOp 4th National Assembly Retreat 2024 on Saturday, May 26, 2024 in Lagos.
THEME: THE CPS: NAVIGATING CHALLENGES AND UNLOCKING A SECURED FUTURE FOR PENSIONERS
Good morning, Distinguished Guests,
Chairman of the Senate Committee on Establishment on Public Service: Senator Oluwole Fasuyi
Chairman of the House Committee: Honourable Hussaini Jallo
Director-General of the National Pension Commission: Hajia Aisha Dahir-Umar
Chief Executives of Pension Fund Operators
Executive committee of Pension Fund Operators Association of Nigeria,
Gentlemen and ladies of the press,
Distinguished ladies and gentlemen,
It is my pleasure to stand before you today to be able to convene this retreat with Federal lawmakers who have oversight over pension. Suffice to say that the pension industry is very critical to the growth of the Nation. Nigeria’s pension industry has been the fulcrum for a lot development that has happened in the country over the last fifteen years and this fact is not lost on us as pension fund managers. We realize this and we take this responsibility very seriously.
The Contributory Pension Scheme (CPS) which Nigeria operates is actually a case study for many other countries. Nigeria has been able to transition from a largely unfunded and fraud prone pension system which was in existence prior to 2004 into one that we are all proud of today. The CPS has delivered a lot of benefit over the years. These benefits include;
1. Moving pension fund management out of the hand of companies; ensuring that private sector organizations do not have to manage their own pension systems. They can outsource this to private sector fund managers who do this for them in a very professional and transparent manner.
2. Another benefit of CPS is the fact it has provided the opportunity for the accumulation of long-term capital which serves as an avenue to invest in various sectors of the economy. As we will see in the various presentations today, the pension industry has been a major driver of growth in Nigeria’s financial market. The pension funds have been the largest players in the bond market and equity markets. We are very proud of the work we have done in this regard, and we continue to look for opportunities to develop and deepen the market.
3. The CPS has also ensured that there is transparency in pension administration in Nigeria. Under the CPS, every individual contributor has a personal retirement savings account, which they can access at any time. The monies are kept for every individual until they retire. This has created a lot of trust in the system, and tens of millions of Nigerians have come to trust the pension system which the CPS has created.
4. Another benefit of the CPS is the safety of funds which is ensured by the segregation of pension assets between the Pension Fund Administrators (PFAs) and the pension Fund Custodians (PFCs). This is the bedrock of the CPS this is a process that has been tested over the years and has proven to be effective.
Distinguished ladies and gentlemen, we have seen the various benefits of Nigeria’s Contributory Pension Scheme over the years. At this juncture, it is important to state that the most important people in any pension system are the contributors and the pensioners. We want to state that we are committed to this group of people and will continue to work to ensure that these people are served while working and also when retired. As we gather today to find out ways to improve on the system and to improve the experience for pensioners, what we must have at the back of our minds is that we need to work with the mind set of constant improvement. We need to ensure that the pension systems continues to retain its sustainable and transparent nature and also continues to deliver value to the economy.
We cannot go back to the dark days of queues, missing files, missing pension, lack of documentation, etc. The future of pension management in Nigeria and the world is private sector driven. We cannot go back; we must think of the future. We must think of how to make things better, and ensure that we protect the sanctity of the pension system for the benefit of the pensioners and the economy as a whole.
Once again, I thank you for listening to me. We commit to continue to work with your committee towards improving our pension system for the benefit of the economy and Nigerians as a whole.
God bless the Pension Industry.
God bless Nigeria.
Thank you.
