The Acting Director General of the National Pension Commission (PenCom), Ms. Omolola Oloworaran, has attributed the N20.87 trillion growth of pension fund assets to sound regulation and stringent oversight of the Commission in the last 20 years.
This is even as she disclosed that the Retirement Savings Accounts (RSAs) have also grown to 10.41 million within the same period.
Ms. Oloworaran spoke on Thursday at the annual conference of the Pension Correspondents Association of Nigeria (PenCAN) in Abuja.
The industry assets grew from N815.18 billion in 2007, to N2.24 trillion in 2011, N5.11 trillion in 2015, N9.58 trillion in 2019, N14.42 trillion in 2022, and N20.87 trillion by July 2024.
Represented at the event by the Head Corporate Communications, PenCom, Mr. Ibrahim Buwai, the PenCom boss said the growth trajectory of the assets since the commencement of the Contributory Pension Scheme (CPS) remains a key performance indicator.
According to her, the growth was more significant considering the over N2 trillion estimated pension liabilities prior to June 2004, noting that the sector reforms introduced were designed to reverse the inefficiencies of the Defined Benefit Scheme and institute a sustainable pension system for Nigeria.
“The CPS introduced a paradigm shift in pensions, resulting in a contributory scheme whereby both employer and employee were required to contribute monthly towards pensions for Nigerian workers.
“This ensured that retirement savings were fully funded, portable, and accessible to workers in both the public and private sectors.
“Most importantly, it empowered workers to make individual choices, with their pension contributions being remitted into individual Retirement Savings Accounts (RSAs), managed by Pension Fund Administrators (PFAs) of their choice and kept in safe custody by Pension Fund Custodians (PFCs),” Ms. Oloworaran said.
She highlighted other milestones so far achieved in the industry to include the launch of the Micro Pension Plan (MPP) in 2019 and the automation of the annual verification and enrolment of prospective retirees of Treasury-funded Ministries, Departments, and Agencies (MDAs).
Specifically, she said, the automation of the verification and enrolment process has replaced the hitherto manual enrolment, which required prospective FGN retirees to physically participate at the nearest centre nationwide, adding that the online application now has the capabilities to register, verify, and enrol prospective retirees through mobile phones, computers, and other devices.
She further affirmed that the introduction of the Guidelines on Accessing RSA Balance for Residential Mortgages has made a positive impact on contributors.
“The RSA holders can now use a portion of their pension savings as equity contributions for residential mortgages.
“This initiative has already empowered over 5,000 workers to achieve homeownership, with ₦47.13 billion disbursed as equity contributions from their RSAs to mortgage lenders,” she said.
While noting that the delay in the payment of accrued pension rights for the retirees of Treasury-funded MDAs was still a challenge in the industry, the PenCom boss assured that efforts have reached advanced stages to not only clear all outstanding pension liabilities of the Federal Government under the CPS but to also put in place lasting solutions that will address the problems of inadequate funding and delay in fund releases for the payment of accrued rights.
She lamented that huge gaps still abound in education and enlightenment on the CPS despite concerted efforts, noting that the lack of awareness often engenders inaccurate perceptions about the scheme.
For instance, she said, many are unaware that the rate of monthly pension contributions of 10% employer and 8% employee are just prescribed minimums, saying that an employer may increase the contributions or decide to bear the full responsibility of the 18%.
“Furthermore, the Commission has also introduced guidelines on Additional Benefit Schemes which employers can implement to pay employees additional end-of-service benefits, including gratuities,” Oloworaran said.
She applauded the media, particularly PENCAN, for their role in enlightening stakeholders on the lofty objectives of the CPS, adding that PenCom remains committed to the objective of ensuring timely payment of retirement benefits through the diligent regulation and supervision of the CPS.
Also speaking, the Chief Executive Officer of the Pension Fund Operators Association of Nigeria (PenOp), Mr. Oguche Agudah, said the pension contribution between the public and private sectors has increased to N11 trillion between 2011 and 2024.
Mr. Agudah said the value of investments in infrastructure increased from N178.08 billion in 2011 to N169.67 billion in 2024; the value of investments in the equity market also increased from N344.69 billion in 2011 to N2.16 trillion in 2024; and the value of investments in corporate debt increased from N69.32 billion in 2011 to N2.25 trillion in 2024.
According to him, a lump sum of N1.12 trillion was paid to 357,310 retirees as programmed withdrawal and annuity in the last 15 years.
In a presentation titled “20 years of pension reform: gains, challenges, prospects,” Mr. Oguche said about N247.47 billion was paid to 483,464 Nigerians between 2011 and 2024, as a 25% RSA balance for loss of job.
This is even as he said, that a total of N451.2 billion was paid to 104,259 beneficiaries as death benefits pay-out within the period.
Earlier, the President of PenCAN, Mrs. Nana Musa, said the conference provided a unique platform for critical discourse, networking, and knowledge sharing among experts, policymakers, and stakeholders.
Mrs. Musa said the gathering was for industry stakeholders to reflect on the gains, challenges, and prospects of the PRA after 20 years of existence.
According to her, the milestone conference was also put together to launch the second edition of the association’s magazine, which showcases insightful articles, analysis, and interviews on pension-related issues.
The high point of the event was the launch of the second edition of PenCAN Magazine, and presentation of awards to deserving agencies and personalities in the industry.
