Tuesday, February 23, 2016 9:50 pm
The National Pension Commission of Nigeria, PenCom, has disclosed that Pension funds have risen to N5.3trillion. But while it is quite legal to make the huge funds available for investors who are free to access and invest it on infrastructural development, they have mostly fallen short of the requirements that make this possible.
Chinelo Anohu-Amazu, Director General of PenCom has disclosed that investors have chosen to steer clear of the funds because they do not have what it takes to scale the hurdle of stringent guidelines required to unlock the funds. The stringent measures were put in place to ensure that the contributions of workers and retirees are not diverted for illegal investments or personal use.
According to the Director General of PenCom, the same law gives room for up to 80 per cent investment in federal government bonds and also provides for infrastructure investments with the access funds. But the guidelines in place have thus far helped in securing the funds and keeping it well beyond the reach of shady investors and the majority that just do not have what it takes to have access to it.
‘’There is no money lying anywhere, not one kobo of the pension funds,’’ says Anohu-Amazu, who is not moved by the growing clamour for more pension fund activity in infrastructure. ‘’What we are saying back is that the reason why there isn’t that activity is because they have not met the required guidelines,’’ she reiterates. Anohu-Amazu said in Lagos on Tuesday that a window has been opened for the informal sector workers which include the SMEs and artisans to have financial security at retirement in the micro-pension scheme.
The PenCom DG whose desire is to have more people under the umbrella of the pension scheme cites Alaba Market as one of the major clusters of thriving business in the country where the traders have generally not subscribed to the idea of having a Retirement Savings Account. “These are people that are moving a huge segment of the funds in this country, and they don’t have savings. We need to change that,’’ she noted.
Hitherto, pension was perceived as being only for the privileged class working in various government departments and for those in paid employment in the formal sector. But with the pension reform act 2014, the informal sector forming up to 80 percent of workers have been accommodated.