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Business News

PenCom discontinues Employee Death Benefit Account  

PenCom has discontinued Death Benefits Account (DBA) for deceased employees under the contributory pension scheme.

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PFAs make N1.69 trillion ROI , Pension Contributions in Nigeria rose by N169.9 billion in 3-month , PenCom calls for thorough scrutiny of dead RSA holders’ benefits, PenCom discontinues Employee Death Benefit Account  , PFAs boost investment in infrastructure by N17.77 billion in one year , Pension: Low RSA balances - a subtly growing concern, PENCOM boss queried for spending unapproved funds, N5 billion on 360 staff in 8-month , How negative performance in the capital market affected PFAs in 2019, PenCom seeks pension bonds to clear N400 billion arrears as retirees groan, PenCom set to offer pension bonds to offset unpaid pension arrears, Is the pension asset just another cookie jar?, PenCom threatens companies with no insurance covers for their staff , PENCOM Notifies RSA holders on the mandatory data recapture exercise

The National Pension Commission (PenCom) has discontinued Death Benefits Account (DBA) for deceased employees under the contributory pension scheme.

According to the notice issued by the regulator, the processing of DBA for claims is going to be discontinued with effect from 1 February 2020. All Pension Fund Administrators (PFAs) have been directed to stop the opening of DBAs effective from 31 January 2020.

Prior to the Pension Reform Act (PRA) 2014, Death Benefits Account (DBA) was used by legal beneficiaries to access the benefits of the deceased employees who did not open RSA during their lifetime. However, pursuant to the above-cited statutory provisions, this practice is no longer valid.

PenCom bars PFAs from collecting bond’s brokerages fee  

The Pension Reform Act Section 11(1) mandates every single eligible employee to maintain a retirement saving account (RSA) with a PFA of his/her choice. The act also mandates every employer to open a nominal RSA within 6 months of assumption of duty for an employee who fails to open an RSA in accordance with section 11(5) of the PRA 2014. Employers are therefore required to ensure that RSAs are opened for all their employees.

In recent development, which was published on Nairametrics, the regulator called for thorough scrutiny of all cases reported to Pension Fund Administrators about dead Retirement Savings Account holders before making payment to the beneficiaries. This came in the light that some unidentified fraudsters under the disguise of being relatives of workers and retirees under the Contributory Pension Scheme had been approaching the PFAs to collect the pensions of contributors.

[READ MORE: PenCom bars PFAs from collecting bond’s brokerages fee]

Meanwhile, the National Pension Commission was established in 2004 with the following objectives:

  • 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;
  • to assist individuals by ensuring that they save to cater for their livelihood during old age and thereby reducing old-age poverty;
  • to ensure that pensioners are not subjected to untold suffering due to inefficient and cumbersome process of pension payment;
  • to establish a uniform set of rules, regulations and standards for the administration and payments of retirement benefits for the Public Service of the Federation, Federal Capital Territory and the Private Sector; and
  • to stem the growth of outstanding pension liabilities.

Download the PenCom notice here.

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    Economy & Politics

    FG places high profile Nigerians under security watch for terrorism financing

    The FG has said that it is currently profiling a large number of high profile Nigerians who have been alleged to have reasonable links to terrorism financing.

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    FG to establish a new anti-corruption agency, P&ID, FG, malami, $9bn fine is a scam - Federal Government , UPDATED: P&ID operations shut down, assets forfeited by court order

    The Federal Government has said that it is currently profiling a large number of high profile Nigerians who have been alleged to have reasonable links to terrorism financing.

    This follows the arrest of an undisclosed number of suspects recently after the convictions of some Nigerians on terrorism financing in the United Arab Emirates (UAE).

    This disclosure was made by the Attorney General of the Federation and Minister of Justice, Abubakar Malami, during a chat with the press at the Presidential Villa, Abuja on Friday.

    What the Attorney General of the Federation is saying

    The Minister said that the convictions of Nigerians in the UAE has given rise to wider and far-reaching investigations in Nigeria.

    Malami in his statement said, “As you will actually know, sometimes back, there were certain convictions of Nigerians allegedly involved in terrorism financing in the United Arab Emirates (UAE).

    That gave rise to a wider and far-reaching investigation in Nigeria and I’m happy to report that arising from the wider coverage investigation that has been conducted in Nigeria, a number of people, both institutional and otherwise, were found to be culpable, I mean reasonable grounds for suspicion of terrorism financing have been established, or perhaps has been proven to be in existence in respect of the transactions of certain high-profile individuals and businessmen across the country.

    I’m happy to report that investigation has been ongoing for long and it has reached an advanced stage. Arriving from the investigation, there exists, certainly, reasonable grounds for suspicion that a lot of Nigerians, high-profile, institutional and otherwise, are involved in terrorism financing and they are being profiled for prosecution.

    In essence, it is indeed true that the government is prosecuting and it’s indeed initiating processes of prosecuting those high-profile individuals that are found to be financing terrorism. It is indeed true.

    Hotflex

    However, Malami did not give the number of such suspects as he maintained that investigation was still ongoing until a conclusion is arrived at.

    “As to the number, the investigation is ongoing and it has to be conclusive before one can arrive at a certain number, but one thing I can tell you is it is a large number and they are being profiled for prosecution.

    It is indeed a large number and I’m not in a position to give you the precise number as at now because the profiling and investigation are ongoing.”

    Malami warned that government will not hesitate to invoke the full wrath of the law on anyone found culpable in sponsoring terrorism in the country as nobody found culpable in terrorism financing will be spared.

    What you should know

    It can be recalled that in March 2021, the Association of Bureau De Change Operators of Nigeria (ABCON) confirmed the arrest of some of its members by security operatives over the investigation of some of their transactions which border on money laundering, terrorism financing and Know Your Customer status.

    ABCON in its statement said that it considers these as serious allegations especially given the security challenges facing the country. It appealed to the authorities to expedite action to ensure that innocent people who have been caught up in this investigation can be released and so that they can return to their anxious families and resume their lives.

    Jaiz bank
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    Macro-Economic News

    Nigeria’s VAT collection surges to N496.4 billion in Q1 2021

    Nigeria’s VAT collection surged by 52.93% (year-on-year) to stand at N496.4 billion in Q1 2021.

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    VAT

    Nigeria generated a sum of N496.39 billion revenue from Value Added Tax (VAT) in the first quarter of 2021, a surge of 52.93% year-on-year compared to N324.58 billion recorded in the corresponding period of 2020.

    This is contained in the sectoral distribution of value added tax report, recently released by the National Bureau of Statistics (NBS).

    According to the report, VAT collections in the period represents a 52.93% increase as against N324.58 billion recorded in Q1 2020; and a 9.17% increase compared to N454.7 billion recorded in the previous quarter.

    The increase in VAT collections could be attributed to increased economic activity in the country, compared to the previous year, where most economic activities were put on hold as a result of the covid-19 pandemic.

    Highlights

    • Highlights of the report showed that the manufacturing sector generated the highest amount of VAT with N49.41 billion generated, closely followed by Professional Services, having generated N42.50 billion, and State Ministries & Parastatals, which generated N26.96 billion.
    • Mining generated the least, closely followed by Pioneering, Textile & Garment Industry with N48.36 million, N77.01 million, and N289.41 million generated respectively.
    • Also, out of the total amount generated in Q1 2021, N224.85 billion was generated as Non-Import VAT locally while N171.66 billion was generated as Non-Import VAT for foreign.
    • The balance of N99.88 billion was generated as NCS-Import VAT.

    Manufacturing sector topples professional services

    The manufacturing sector toppled the professional services sector to lead the list of sectors with the highest VAT remittances in the first quarter of 2021. A total of N49.41 billion was collected as Value Added Tax from the manufacturing sector.

    • Professional services followed closely, having remitted N42.5 billion in VAT to the government, State ministries and parastatals stood in third position with N26.96 billion VAT.
    • Others on the list include; Commercial and trading sector with N22.8 billion, oil-producing (N15.8 billion), Transportation and haulage services (N14.9 billion), Breweries, bottling, and beverages (N11.9 billion).
    • Federal ministries and parastatals (N8.8 billion), banks and financial institutions (N3.3 billion), and oil-marketing (N3 billion).

    Why this matters

    • The increase in VAT collection is a development in the right direction, especially given the recent positive growth recorded in global crude oil prices, indicating an increase in government revenue.
    • However, the government needs to intensify its effort in creating innovative ways of increasing revenue given growing overheads and statutory spending, coupled with increasing debt profile.

    Continue Reading

      





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