Reps under fire over Pension Act amendment - TREAT P WORLD

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Reps under fire over Pension Act amendment

Reps under fire over Pension Act amendment

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By Victor Ahiuma-Young & Favour Nnabugwu

STAKEHOLDERS in the pension industry have taken up arms against the
House of Representatives over ongoing attempts at amending the Pension
Reform Act, PRA, less than three years after it was amended in 2014.
Specifically, they are kicking against the plan to exclude paramilitary
institutions from the Contributory Pension Scheme, CPS.

In fact, a bill seeking to amend the Pension Reform Act, 2014 to exclude
personnel of the Nigeria Police, the Nigerian Security and Civil Defence Corps,
and Nigeria Customs Service, Nigerian Security, Civil Defence Corps, NSCDC,
from the Contributory Pension Scheme, had on May 16, passed the second
reading on the floor of the House of Representative was opposed. The bill,
sponsored by Mr. Oluwole Oke, is also seeking to exempt the Economic and
Financial Crimes Commission, EFCC, from the scheme.

At a public hearing on the bill in Abuja, Nigeria Labour Congress, NLC;
Central Bank of Nigeria, CBN; National Pension Commission, PenCom;
Nigerian Police Force, NPF; Pension Fund Operators Association of Nigeria,
PenOp; National Insurance Commission, NAICOM and others, totally rejected
the plan, warning that it would among others, undermine the system.
President of NLC, Ayuba Wabba, who spoke, noted that the “bill looks good
on the surface, but inwardly it will destroy the future of workers”, adding that
“the position of the congress is that the bill should be dropped. The bill is not
workable and if implemented, it will collapse the pension system.” He said
the federal government could not absorb more financial burden going by the
present low revenue.

Financial burden

Acting DG, PenCom, Mrs. Aisha Dahir-Umar, said the issues raised were
challenges which were presently being worked on, adding that the challenges
were temporal which would be resolved very soon. She said “It is wrong to
ask one to give what he does not have.

The government has been borrowing to pay salaries and cannot continue to
borrow to pay pension. There is no point legislating what you cannot enforce.
It is too early to amend the law. If we allow this law pass we cannot
recover. We should come together to sustain the gains of the CPS.”
Inspector General of Police, Ibrahim Idris, who was represented by
Commissioner of Police, David Bodo, said the NPF Pension Fund
Administrator, PFA, had done very well and that the Police is of the opinion
that it would remain with the CPS. He called on the government to attend to
issues already raised by the force which were being attended to by PenCom,
stressing that the welfare of the Nigerian Police would be well taken care of
under the CPS.

Former Director General of PenCom, Mohammed Ahmad, warned against the
planned exclusion, noting that the number of people seeking exemption might
be up 50 per cent of government workers, which government could not cater
for. He contended that the budget could not sustain the exemption, insisting
that “CPS remains a safe vehicle for creating national saving.”

President, PenOp, Longe Eguarekhide, said the critical thing with the CPS was
funding, stressing that policy maker should always think of ways to improve
lives instead of creating more burden for the government.

General Secretary of National Union of Textile, Garment and Tailoring Workers
of Nigeria, NUTGTWN, Mr. Issa Aremu, in a statement argued that any private
member’s bill which seeks to erode the gains of the 13 year old N7 trillion
CPS in terms of coverage and resource pools is counterproductive and should
not be encouraged.

Aremu who is also the Vice President of Industrial Global Union, African
Region, said Pension Reform Acts of 2004 and 2014, were outcomes of
executive bills which addressed the delicate interests of pensioners,
government and the economy, noting that “in principle a private member’s bill
informed by narrow and vested interest considerations cannot do justice to
all.

The pensions of the nation’s working men and women in security services are
better secured in a national contributory scheme than the old unfunded and
unsustainable discredited Defined Benefits Scheme (DBS). Until the recent
pension reform, all stakeholders bore witness to ugly features of corruption,
inefficiency and share looting which characterized DBS.
To return to the old era means bringing back corruption to pension
administration through the National Assembly.

“The Pension Act had just been amended through executive/all inclusive
review two years ago. With all its globally acknowledged successes the
contributory pension covers only seven million workers, to further ask for
exclusion of the security agencies only undermines the scheme with all the
attendant negative implications for Nigerian economy just coming out of
recession. We call all members of the Assembly to reject the private bill
which will return pensioners to the bad old days of non-payment of
pensions.”

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