The National Pension Commission (PenCom) said it is making efforts to educate the populace on the Contributory Pension Scheme as the public appears uninterested.
In an interactive session during the ongoing Social Media Week (SMW) in Lagos, the commission acknowledged the need for a more proactive engagements by the Pension Fund Administrators (PFAs) to improve the scheme.
The Pension Reform Act 2004 establishes a contributory pension scheme for all employees in Nigeria to ensure that every person who worked in either the public service of the Federation, Federal Capital Territory or private sector receives his retirement benefits as and when due, as well as to assist improvident individuals by ensuring that they save in order to cater for their livelihood during old age.
In his opening remarks, PenCom’s Director of Research and Strategy, Dr. Farouk Aminu, who represented the Director General, Mrs. Chinelo Anohu-Amazu said the current Contributory Pension Scheme is different from previous systems.
He admitted that previous reported cases of pension fraud could be responsible for why members of the public are hesitant to embrace the scheme and explained how the commission is trying to change the narrative.
According to Dr. Aminu:
“We are making efforts to change the perception of the public on the Contributory Pension Scheme. What is lacking for the effective scheme in Nigeria is proper database of workers. The informal sector is largely uncovered by PenCom and represents about 70 per cent of Nigeria’s total working population.
“The Pension Reform Act 2014 has expanded coverage to the States, Local Governments, and the informal sector – self-employed and organisations with at least 3 employees. Our target is to cover 30% of Nigerians to the contributory pension scheme.”
The PenCom director also clarified that the pension funds, now worth N5.3 trillion, is primarily held as bonds and investment instruments.
“It’s becoming more evident people think the Commission has access to the 5 trillion in #RSA contributions. It doesn’t!”