The pressure created by the failure of defined benefit scheme in the minds of Nigerians, especially contributors, that pension assets when contributors retire, will not be available, has been debunked as not applicable to the current Contributory Pension Scheme.
The failure of the defined benefit was not much with the system of pension in place all over Nigeria, federal, states and local government, but with lack of funding. Before CPS commenced in 2005, the federal government was owing over N1tr pension liabilities in arrears, this struck deep in the government of President Olusegun Obasanjo, and they went straight to fix it. Despite the fix the fear of a repeat lingers.
However, the managing director, Access Pension Fund Custodian PFC, Mrs Idu Okwuosa, affirms that a repeat of the former failed pension era is ruled out. The present pension system is structured differently. She explains. “The public should be assured that all pension assets are traded in the name of the Pension Fund Administrator (PFA) and Pension Fund Custodian (PFC), in other words, the investments are made in the PFA/PFC name.”
Okwuosa’s answer came as a reaction to a question on safety of pension assets at the 2020 media retreat hosted by Pension Fund Operators of Nigeria, albeit by webinar and attended by PenOp executive council members, representatives of PenCom in the person of Mr. Peter Aghahowa; head, corporate communications, and Mr. Polycarp Anyanwu, head, information communication technology and 34 media professionals.
As a layer of unbroken assets security, Access Custodian boss said in a statement by PenOp that all pension investments in the industry are insured. Therefore, Okwuosa said there’s not a chance that anyone can have access to the funds in the industry.
Besides the aforementioned, she said there is another layer of protection that shields it from pillaging. This reinforced layer of funds protection she explained rates pension assets far above returns if the need arises. Nonetheless, this does not in itself submerge the need for returns which is supported by volumes of regulator policies and guidelines. For the avoidance of doubt, she clears, “The returns are not paramount to the National Pension Commission (PenCom) or operators, as much as the safety of the funds.”
Okwuosa went on further to say that contributors under the Contributory Pension Scheme (CPS) can be rest assured the Pension Fund Administrators (PFAs) and Pension Fund Custodian (PFCs) together with the regulator- National Pension Commission, will continue to ensure the safety of pension assets for the benefit of all contributors.
The annual media parley organised by PenOp is an event that brings together all pension and insurance correspondents in the country to chat and engage directly with the pension regulators and operators in an atmosphere that longs to bridge the gap between the regulators, operators and journalists. The parley also seeks to educate the public through the eyes of the journalists.