Citizen Stanley Nwabia is a young Nigerian.With the country’s economy walking the tightrope of a financial crunch, he has consistently inquired of the panel engaging with the public on pension issues how he could liquidate his pension funds. “I want to liquidate my pension account and why must they tell me to wait till I turn 50,” he tweeted.
The eminent panel discussants answered thus: ‘The RSA was created for retirement benefits and not employment benefits’; liquidating his RSA was not an option.
There are millions Nigerians who, like Stanley Nwabia, do not fully understand or appreciate the Pension Reform Act of 2004 and the detailed workings of Nigeria’s Contributory Pension Scheme (CPS). It was for this reason that the Director General of the National Pension Commission (PenCom), Chinelo Anohu-Amazu, organized an innovative social media roundtable to explain Nigeria’s pension laws and processes better.
The Google Hangout linked to live twitter feeds was not only a novel idea but also presented the perfect vista for interfacing with the general public. Under the personal direction of the DG, the #AskPenComDG panel of experts comprised of some of the highly experienced regulatory officials and pension industry experts in Nigeria. On the team from PenCom were top officials including Mr. Lana Loyinmi – Head, Benefits & Insurance, Mr. M. B. Umar – Head, Compliance & Enforcement, Dr. Farouk Aminu – Head Research & Corporate Strategy, Mrs. G.E. Usoro – Head, Public Sector Pensions and Mr. M.S Muhammad Commission Secretary /Legal Adviser. They were also joined by Mr. Misbahu Umar Yola – Managing Director, Legacy Pension and Mr. Wilson Ideva – Managing Director, Premium Pension.
The PenCom officials displayed admirable knowledge about relevant sections within Nigeria’s Pension Law (Pension Reform Act of 2014) that had to do with withdrawing from a Retirement Savings Account (RSA). One question that agitates the minds of most contributors is thus “Why can’t I withdraw from my RSA any time I deem fit? The reasons are not far from the fact that the law has already set out detailed conditions for withdrawals. The PRA 2014 sets out the conditions to include retirement, permanent medical incapacitation/disability (to be confirmed by a medical board), temporary loss of employment (loss of job without securing another for at least four months). It’s all about ensuring that retirement funds serve the purpose of providing a means of livelihood to a worker at retirement, having actively provided service while in employment.
According to the Hausa proverb, ‘the one who asks questions never gets lost’; with this premise, questions kept coming through.
One of such questions to the AskPenComDG panel was, “how many staff should an organization have before enrolling them in the pension scheme”? The panel stated that employers who have a minimum of three employees were mandatorily required to join the pension scheme. Another query that was addressed in detail was the process of accessing an RSA for a mortgage to own personal homes and also, in cases of a medical disability; there are provisions for access to an RSA.
There were also some complaints about the RSA transfer window, with social media users asking, ‘when the RSA transfer window would be open to enable a contributor switch PFAs’. This was also juxtaposed against the background of the technology infrastructure required for the smooth workings of the RSA transfer window. To this, the panel explained the painstaking efforts of PenCom in providing the structures that will facilitate easy transfers once the window is opened.
Most importantly, the panel was ready and willing to assist employees who had issues and even went ahead to ask contributors to report organizations that are disallowing their employees to enroll into the CPS. This was also alongside issues as well as reported concerns, of non-remittance by some organizations despite debiting a staff’s pay for pension contributions. Such contributors have been advised by the panel to report to PenCom for enforcement action. Questions relating to the integrity of the CPS were also raised. However, it was stated in clear terms that the management and custody of pension assets was exclusively vested in the licensed operators, Pension Fund Administrators (PFAs) and Pension Fund Custodians (PFCs) who are regulated and supervised by the National Pension Commission. This concern, as stated by one of the questioners, was due to some high profile alleged pension fraud cases, such as the Abdulrashid Maina Pension Scam, that are still fresh in the minds of the pensioners.
Most respondents and participants during this social media round table tasked the Panel on withdrawals from their RSA and several times, it was explained that an RSA is not like a regular bank account for withdrawals. It is specifically set up against one’s retirement in the near future, which is a life stage everyone will eventually get to.
Engaging with the Nigerian public via this AskPenComDG event is one classic example of e-governance. This singular discussion forum has gone a long way in explaining to the general public, the intricacies of the Pension Scheme and how it affects the personal lives of contributors and also, the social economy in general.
One hopes where such an interaction medium becomes regular, offering a more direct means for interfacing with public institutions, citizens like Stanley Nwabia are not only better educated and well informed but now understand and appreciate that ‘one’s future shouldn’t be slaughtered on the altar of “enjoyment” today, at the detriment of the future, when one will be frail and unable to work’.
For Chinelo Anohu-Amazu, AskPenComDG is only one of the many initiatives in the resolve to bring pension solutions to the contributors’ doorsteps that PenCom will continue to implement.
SUN
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