The third quarter (Q3) 2020 report of the National Pension Commission (PenCom) indicates that the cumulative recovered fund from employers, from the inception of the scheme, sums up to N17.73 billion.
The sum is made up of principal contributions of N9.05 billion and penalty charge of N8.69 billion.
Highlights of the report
- As at the end of FY2019, the sum of N16.85billion was already accumulated from inception.
- In Q1 2020, N404.26 million was recovered from 35 employers, made up of principal contributions of N180.19 million and penalty charge of N224.07 million.
- In Q2 2020, N261.33 million was recovered from 16 employers, made up of principal contributions of N152.79 million and penalty charge of N108.54million.
- In Q3 2020, N213.07 million was recovered from 13 employers, made up of principal contributions of N156.53 million and penalty charge of N56.54 million.
- Year to date, N878.66 million was recovered from 64 employers, made up of principal contributions of N489.51 million and penalty charge of N389.15 million.
- The year to date penalty charge represents 44% of the recovered sum for the year, and the cumulative penalty charge since inception represents 49% of the cumulative recovered sum.
What you should know
- Section 11 (5) (b) of the Pension Reform Act (PRA 2004) provides that, the employer within 7 days from the day the employee is paid his/her salary, should remit an amount made up of the employee’s and employer’s pension contributions to the preferred Pension Fund Administrator (PFA) of the employee.
- Any employer who fails to remit the specified contributions within the time frame prescribed shall, in addition to making the remittance already due, be liable to a penalty charge to be stipulated by PenCom, provided that the penalty is not less than 2% of the total contributions that remains unpaid for each month the default subsists.
- The Commission assigns the defaulting employers to each agent, for the recovery of the outstanding pension contributions including the interest penalty.
- PenCom could institute legal action against recalcitrant employers that fail to remit all the outstanding pension contributions with the interest penalty to employees RSAs.