PenCom pegs en bloc payment on one third of national minimum wage

Management of National Pension Commission with Pension Journalists at the event.

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Chuks Udo Okonta

The National Pension Commission (PenCom) has said where the fixed portion of Retirement Savings Account (RSA) balance cannot procure monthly pension/annuity up to one third of the prevailing national minimum wage, the contributor shall receive their benefits en bloc.

Head, Benefits & Insurance Department, PenCom, Obiora Ibeziako, said this in a paper entitled: ‘The Administration of Retirement Benefits Under the Micro Pension Plan’, adding that the prevailing national minimum wage shall serve as the annual total emolument for the purpose of benefits computation where the contributor has no pay slip.

Director-General, PenCom, Mrs. Aisha Dahir-Umar, said registered contributors, and the value of pension fund assets stood at 9,795,957 million and N14.27 trillion, respectively, as at June 30, 2022.

She noted that the theme of the workshop, “Increasing Informal Sector Participation in the Contributory Pension Scheme (CPS): The case for Micro Pension Plan”, aligns with the Commission’s objective of expanding coverage of the CPS.

The objective, she posited was to bring in to the CPS, Nigerians working in the Informal Sector and those who are Self Employed through the Micro Pension Plan (MPP). “Therefore, it is of utmost importance to educate the media on the MPP and enlist your support to make the Plan popular amongst informal sector workers and the self-employed. There are three papers slated for presentation by the Commission today;” she said

She said the Commission is mindful of the critical role of Journalists in disseminating factual information to its stakeholders. “So, it is imperative to constantly interact and inform you of recent developments in the pension industry and some of the Commission’s significant activities.

“Strategic efforts to drive the Micro Pension Plan (MPP) remain one of the significant areas of focus of the Commission. The MPP was conceptualized to expand pension coverage to the informal sector, including small-scale businesses, entertainers, professionals, petty traders, artisans, and entrepreneurs. The MPP was implemented to curb old-age poverty by assisting the workers, as mentioned above, to contribute while working and build long-term savings to fall back on when they become old. To create awareness of the Micro Pension Plan, the Commission, in collaboration with the Pension Fund Operators Association of Nigeria, is currently championing an Industry Media Campaign in major cities in the country’s six geopolitical zones,” she noted.

She stated that PenCom increased the Minimum Regulatory Capital (Shareholders’ Fund) requirements of Pension Fund Administrators (PFAs) from N1 billion to N5 billion last year, adding that recapitalization exercise had a 12-month transition from April 27 2021, to April 27 2022 and that as at the deadline, all Pension Fund Administrators (PFAs) have complied with the Commission’s directive to increase the Minimum Regulatory Capital (Shareholders’ Fund) from N1 billion to N5 billion.

“The reason for the recapitalization exercise was to ramp up the capacity of the Pension Fund Administrators to manage the increasing number of registered contributors, and the value of pension fund assets under which I am pleased to inform you stood at 9,795,957million and N14.27 Trillion, respectively, as at June 30, 2022. it is expected that the exercise will bring about increased effectiveness and efficiency as well as improved service delivery in the industry,” she said.

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