“PENCOM AND TUC FORGE HISTORIC PARTNERSHIP TO REVOLUTIONIZE PENSION COMPLIANCE IN NIGERIA”
GREATRIBUNETVNEWS–THE National Pension Commission (PenCom) has taken a significant step towards boosting pension compliance in Nigeria by partnering with the Trade Union Congress of Nigeria (TUC). PenCom’s Director-General, Ms. Omolola Oloworaran, met with TUC President, Comrade Festus Osifo, in Abuja on September 24, 2024, to discuss ways to strengthen their collaboration and advance pension reforms.
Key Takeaways:
– Strengthening Collaboration: PenCom and TUC aim to enhance their partnership to ensure greater compliance with the Contributory Pension Scheme (CPS) and promote pension reforms.
– Pension Revolution 2.0: PenCom’s reform agenda includes introducing health insurance coverage for retirees, activating a minimum pension floor, and optimizing investment returns while safeguarding contributors’ funds.
– Expanding Pension Coverage: PenCom has released guidelines for Foreign Currency (FCY) pension contributions, allowing Nigerians in the diaspora and foreign workers to participate in the CPS.
– Improving Retiree Welfare: PenCom is working on reforms to enhance retiree welfare, including a proposed Health Insurance Scheme for retirees and increasing monthly pensions to 75% of a police officer’s final salary before retirement .
Ms. Oloworaran emphasised that every employer of labour is obligated under the Pension Reform Act (PRA) 2014 to remit pension contributions on behalf of employees. She called for TUC’s support in enforcing compliance, noting that timely remittances were essential for securing workers’ financial stability in retirement.
The PenCom DG also spoke about reforms underway to address value erosion in pension savings. She said PenCom is working to mitigate the impact of inflation on pension assets.
Ms. Oloworaran disclosed that PenCom will unveil a revised Investment Regulation to expand opportunities in alternative investments and deliver better real returns. In addition, she said that the PenCom is working with the Central Bank of Nigeria (CBN) and the Federal Ministry of Finance on mechanisms that will allow pension investments in naira but generate returns in dollars, as part of efforts to safeguard retirement funds.
Furthermore, she said that PenCom would soon introduce a minimum pension for all retirees under the CPS to guarantee a more dignified retirement for Nigerians. This is being enabled by President Tinubu’s approval of a N758 billion bond, which comprises funding for the Pension Protection Fund (PPF), which would fund the minimum pension guarantee.
Responding, Comrade Osifo commended PenCom for its professionalism and effectiveness, describing it as one of the highly performing Institutions in Nigeria. He recounted his experience with PenCom staff during his time in the pension industry, praising their exceptional integrity, competence and dedication.
The TUC president pledged the union’s continued support for the Commission, particularly in promoting compliance among employers. He decried the practice of some employers who deduct workers’ pension contributions but fail to remit them, warning that such delays harm the eventual returns on retirement savings and often lead to industrial disputes.
Comrade Osifo further called for a review of the PRA 2014 to introduce greater flexibility in pension fund investments to better protect savings from inflation and exchange rate pressures.
The meeting ended on a positive note, with both PenCom and TUC resolving to work more closely together to deepen the CPS and secure the future of Nigerian workers.
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