Pension

PenCom, PFOs perfect modalities for implementation of pension protection fund

PenCom

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The National Pension Commission (PenCom) and Pension Fund Operators (PFOs) have determined the financial implication and commenced setting aside required levy toward successful implementation of the Pension Protection Fund (PPF), Inspenonline can report.

Information obtained from PenCom revealed that PFAs had continued to pay monthly pension to retirees whose Retirement Savings Accounts (RSAs) were already depleted from their portion of the Minimum Pension Guarantee (MPG) levy which had already been set aside, prior to the implementation of the MPG.
Commenting the development PenCom said: “The Commission had determined the financial implication and other modalities for the successful implementation of the Pension Protection Fund (PPF).

“These processes were preparatory to concluding the requisite Framework and Guidelines for the eventual implementation of the Minimum Pension Guarantee (MPG). In the meantime, the Commission and PFOs have commenced setting aside the PPF Levy.

“Meanwhile, the PFAs had continued to pay monthly pension to retirees whose RSAs were already depleted from their portion of the MPG Levy which had already been set aside, prior to the implementation of the MPG.”

Section 82(1) of the PRA 2014 provides for the establishment of the Pension Protection Fund (PPF) which is, amongst others, to be utilised for the funding of the Minimum Pension Guarantee (MPG) to be paid to all Retirement Savings Account (RSA) holders who have contributed for a number of years to a licensed Pension Fund Administrator (PFA) and for the payment of compensation to eligible pensioners for shortfall or financial losses arising from investment activities.

The sources of funding of the PPF includes an annual subvention of 1 per cent of the total monthly wage bill payable to employees in the Public Service of the Federation, which shall be utilised strictly for the funding of the MPG.

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