N3.25tr pension funds invested in govt securities, says PenOp



The Nation
By: Nduka Chiejina

About N3.25 trillion out of the almost N5trillion of the Pension Funds so far collected have been invested in Federal Government securities, the managers of the fund, have said.
The Chairman, Pension Fund Operators Association of Nigeria (PenOp), Alhaji Musbahu Yola, said this yesterday when he addressed journalists at the end of the consultative forum between the National Pension Commission (PenCom) and Pension Fund Administrators (PFAs) in Abuja.
He said the invested amount is equivalent of 65 per cent of the almost N5 trillion pension assets currently warehoused by pension operators, adding that another 12 per cent has been invested in equities, while 15 per cent is invested in the money market.
Yola maintained that not withstanding the recent removal of Nigeria from the JP Morgan Index, the country’s Pension Fund Operators will continue to invest in FGN Bonds and Treasury Bills, pointing out that FGN Bonds are not only profitable, they are safe to invest in.
He aid the removal of Nigeria from JP Morgan Index would favour PFAs because exiting foreign investors will have to sell their assets at lower prices and it doesn’t mean that the FGN Bonds have become junk.”
He said PenOp members “will continue to invest in FGN Bonds and Treasury Bills,” wondering where else would we put the money, Treasury Bills and Bonds are safer assets” he said.
Yola also revealed that it has been agreed between the PenCom and PenOp members, that 20 million Nigerians will be captured into the pension net by 2024 from the current 6.6 million pension contributors, saying “this is the best we can do under the circumstances and it points to the fact that majority of Nigerians are employed outside the formal sector.
“State governments have also not complied. The point really is that most Nigerian businesses are informal or are SMEs that haven’t really kicked in for one reason or the other if our economy develops and becomes more Industrialised with more formal corporations, a lot of people will be captured in the pension net but many Nigerian just do small jobs that are not incorporated.
You can’t get them in so easily, we know we have a lot more to do, but we shouldn’t be discouraged by the fact that it is 6.7 million out of 170 million. Our objective is to go 20 million by 2024, that is where the informal sectors being captured in the guidelines comes in” he said.
Regarding unremitted employees’ pension after deductions have been made, members of PenOp urged employees to blow the whistle on the employers. They said “employees are responsible for their pension. If employers are not remitting, employees should go to their PFAs and report, you must be in charge of your pension. The PFAs do not have the power to enforce complaints. PENCom has the power of enforcement and they have engaged recovery agents employees must also rise up the law is backing them they have to find the means of making their employers make those remittances on their behalf either as a union, they must come together and pressurize their employers particularly where they have deducted from the salaries and have not remitted.”
Yola and his team PenOp associates wondered that “if people are afraid of speaking up for their right who will do it for them? Now anybody who wants to do a job with the federal government must produce their certificate of compliance and some private organizations have included it in their manuals too so that they don’t go foul of the law especially those that provide them with contract staff. To prevent victimization PenCom has been mandated not to reveal the identity of whistle blowers.”


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