Pension assets rise by N160bn in four months

Total assets under the Contributory Pension Scheme, which are being managed by the Pension Fund Administrators, rose by N160bn from June ending to October.

Figures obtained by our correspondent from the National Pension Commission on Monday revealed that the pension funds which stood at N4.41tn in June rose to N4.45tn in July.

According to PenCom’s record, the funds rose to N4.58tn in September, which however dipped to N4.57tn in October.

The commission also disclosed that workers contributing to the Retirement Savings Account rose from 5.9m at the end of 2013 to six million in the first quarter of 2014 and 6.1million in the second quarter.

The Director-General, PenCom, Mrs. Chinelo Anohu-Amazu, said the CPS had generated a pool of long term investible funds that were attractive to fund managers, investment advisers and capital market operators who wanted to access part of the fund for different purposes.

According to her, the Pension Reform Act has ushered in a uniform Contributory Pension Scheme for workers in both the private and public sectors.

She said its implementation which started in June, 2004 reformed the crisis-ridden defined benefit pension schemes in the country.

“Before then, the huge and increasing pension liabilities in the public sector needed to be addressed while most workers in the private sector were not covered by any form of retirement benefit scheme,” she said.

She noted that the inefficient administration of pension schemes and demographic shifts made defined benefit scheme unsustainable.

She said the amendments to the pension law were to take care of shortfalls in coverage, address supervisory and enforcement challenges, correct anomalies in the taxation of pension assets and enable the disbursement of the pension funds to develop infrastructure.

According to her, there is a need to criminalise fraudulent diversion and conversion of retirement savings of workers and retirees and bring the pension reform law in tune with current developments.

This, she added, necessitated a change in the strategy with a view to exploring new investment windows for pension funds among other things.

Anohu-Amazu said the accumulated pension assets in custody of Pension Fund Custodians were being privately managed by PFAs while PenCom regulates and supervises pension operators.