PFAs Pay 11,796 Disengaged Workers N5.33bn

The Contributory Pension Scheme (CPS) has continued to relieve pressure on workers who lose their job, by paying them 25 per cent out of their pension.

According to the National Pension Commission (PenCom), 11,796 workers who lost their jobs were paid N5.33 billion from their Retirement Savings Account (RSA) by Pension Fund Administrators (PFAs) between October and December, last year.

The Director-General, PenCom, Mrs. Aisha Dahir-Umar, said the disengaged workers were those who were under 50 and were unable to secure jobs within four months in the fourth quarter of last year.

She said the commission also approved the payment of N4.31 billion to 8,221 disengaged workers who were unable to secure another job in the first quarter of the same year.

Also, the PenCom boss further said following the issuance of demand notices to defaulting employers whose pension liabilities had been established by the Recovery Agents (RAs), N553 million, representing principal contribution of N382.4 million and penalties of N170.5million were recovered from 19 defaulting employers in October to December 2020.

She stated that the total pension contributions remitted to RSAs in the fourth quarter of 2020 stood at N167.74 billion.

She added that out of this total, the public sector accounted for N86.93 billion or 51.81 per cent, while the private sector contributed N80.81 billion or 48.18 per cent.

She maintained that the cumulative pension contributions received from the public and private sectors from inception to the end of the fourth quarter of last year, therefore, amounted to N6.70 trillion, up from the N6.54 trillion as at the end of the third quarter of the period under review, representing a growth of 2.45 per cent.

She said PFAs registered a total of 68,827 RSAs during the quarter under review, bringing the cumulative RSA registrations from inception to 31 December 2020 to 9,215,788.

The pension industry, she noted, recorded a net marginal growth of 0.72 per cent (66,704) in schemes membership during the quarter under review, rising from 9.20 million contributors as at the end of the preceding quarter to 9.27 million as at Q4 2020.

The growth in the industry membership was driven by the RSA Scheme, which had an increase of 68,749 registered contributors.

It noted, however, thatmembership of the Closed Pension Fund Administrator (CPFA) Schemes declined by 2,045 to 14,926 while the Approved Existing Schemes (AESs) membership remained unchanged at 40,951 as at Q4 of last year.

She stressed that the implementation of the CPS had impacted the economy, stressing that the major visible areas of this impact were the economic and social spheres.

Speaking further on the development in the pension industry, Mrs Dahir-Umar said micro pension was gaining traction.

She said: “During the quarter under review, 20 PFAs registered 3,663 contributors under the Micro Pension Plan and a total sum of N25,024,528.08 was remitted to the RSAs of the contributor within the same period.

“In terms of withdrawals from the contingent portion of the contributions, six PFAs processed and approved requests amounting to N880,521.29 from 11 MPP participants during the review period,” she added.