The Nigeria Labour Congress (NLC) has said the sustainability of Contributory Pension Scheme (CPS) is under threat, citing the federal government liability in the scheme which it said stands at N183 billion naira.
This is just as retirees under the scheme under the aegis of Association of Contributory Pension Retirees lamented some of the challenges associated with the scheme.
Speaking at the congress of the Association, NLC president, Ayuba Wabba said the Contributory pension scheme is being threatened by non compliance by major stakeholders, especially employers.
He said retirees under the scheme go through a lot to access their funds. According to him, if the issues and challenges inherit in the scheme are not addressed, the scheme will soon but the rocks.
He said, “issues of payment of benefit in Nigeria has become a nightmare. This needs to be addressed
Also speaking, President of the Nigerian Union of Pensioners (NUP), Dr Abel Afolayan, enumerated some of the challenges bedevilling the contributory pension scheme.
Hr said the inability of the federal government in releasing funds has caused pensioners under this scheme to suffer because no retiree was paid since October 2015 date.
According to him, large numbers of next of kins of deceased pensioners have not been able to access the entitlements of their relations which has made life unbearable for the beneficiaries.
He said, “non-release of accrued right by the federal government to national pension commission to pay the retirees who retired since October 2015-date.
“Many organizations of government and other employers of Labour have been defaulting on the regular remittances of Contributions of workers to their pension fund administrators which is affecting the philosophy of the scheme.
“Non-compliance with section 173 (3) and section 210 (3) of the 1999 constitution ( as amended) and section 15 of 2014 pension reform act (as amended) which stipulates that pension shall be reviewed after every five years whenever workers Salaries are reviewed which ever one that is earlier. Non-compliance with the provisions of this law by government has made the contributory pensioners loose 15% pension increase of 2007 and 33% increase in 2010 respectively.”
the Nigerian pension scheme has enumerated challenges that must be addressed and tacked immediately,so as to avoid the mistakes of the past.
He said the 2004 pension act has abolished the right of the pensioners under this scheme to earn gratuity thus denying the employees the chance of getting getting the usual lump gratuity by the employer to his employee at the time of retirement.
According to Afolayan, the Pension commission didn’t specify how pensioners can benefit from returns on the investment accrued from their contributions which has left the pensioners who are the legitimate owners of the funds in hardship.
According to him, the union has been making efforts to ensure that contributory pensioners entitlements are not denied. In the recent time, specific
He said, “The union has presented to government the demands of Contributory pensioners especially the payment of accrued right. Also the uinion has appeared before the joint committee on budget appropriation at the National Assembly and submitted a memorandum requesting over N183 billion only to find the accrued right of retirees from 2015 to date.
Explaining the reasons that gave birth to the CPS, Afolayan said the 2004 pension reform act aimed at ameliorating the suffering of the Nigerian pensioners under the Defined Benefit Scheme that relies on funding heavily on the statutory budgetary provision from various tiers of government.
He said however, the government could not sustain the scheme due to the inability of various organs of government to pay pension entitlements as at when due. Hence the government decided to introduce the 2004 new pension reform act.
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