COVID-19 pandemic forces pension contributions down by 30%

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Chuks Udo Okonta

The lockdown which was herald by the COVID-19 pandemic has forced pension contributions and remittance down by at least 30 per cent, Inspenonline can report.

The Managing Director of one of the nation’s Pension Fund Administrators (PFAs) told this medium that the pandemic had serious impact on pension contributions and remittance. According to him, while people were at home, most companies could not remit their workers contributions.

He noted that the full impact of the pandemic on the Contributory Pension Scheme (CPS) would be determined when businesses fully commenced.

According to the National Pension Commission (PenCom), about N29 billion was injected into the pension fund assets in January and February 2020.

Data obtained from PenCom revealed that the pension fund assets stood at N10.22 trillion as at December 31, 2019 and moved to N10.51 trillion by February 29, 2020, showing a difference of N29 billion.

PenCom also noted that the total Retirement Saving Account (RSA) fund moved up by N23 billion, soaring from N7.85 trillion in December 2019 to N8.08 trillion in February 2020, while investments in federal government’s securities fell by N25 billion, sliding from N7.34 trillion in December 2019 to N7.09 trillion in February 2020 and amounts put into bank placement moved up by N42 billion, from N1.06 trillion to N1.48 within the period.

The pension industry regulator posited that Pension Fund Managers (PFM) had invested N7.77 million contributed by micro pension subscribers as at February 29, 2020 in Federal Government’s treasury bills and bank placement.

Giving a breakdown of how the 7.77 million fund were invested, PenCom said N3.10 million of the micro pension fund was invested in Federal Government treasury bills while N3.75 million went into bank placement.

According to PenCom, Micro Pension Plan (MPP) had recorded 28,000 subscribers as at October 2019 and about N30 million has so far been contributed by informal sector workers.

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