PENCOM Approved N15.79Billion To Beneficiaries of Deceased Retirees

 

The sum of N15.79 billion as a death benefit to the administrator and legal beneficiaries for 5,562 deceased employees and retirees has been approved by the National Pension Commission.  

According to Pencom, benefits presented significant challenges to retirees.

“Before the CPS, large pension liabilities made it impossible for the federal and state governments to meet their pension obligations to retirees. At the same time, the private sector retirement plans offered low pensions,” PenCom said.

According to the report,  management from custody under its regulatory supervision introduced by byS revolutionized Nigeria’s pension and retirement landscape. 

“The RSA allows participants to open individual accounts where contributions accumulate until retirement,” the commission said.

“The RSA eliminates pension liabilities, and once an employee exits active service, funds are available for immediate payment of retirement benefits. The RSA also allows members to make voluntary contributions to their RSAs, and PFAs must provide regular/periodic account statements to keep contributors informed.

“The CPS allows for easy labor mobility across sectors and different tiers of government. Once an RSA is opened and a personal identification number (PIN) issued to an employee, the number remains tied to the employee throughout their lifetime, allowing them to maintain their RSA for contributions from new employers.

“There is no need to open another RSA when changing jobs, only providing the new employer with the PIN and the PFA.

“Contributors under the CPS have the opportunity to select any PFA of their choice to open their RSA, transfer their account from one PFA to another once a year, and choose either the programmed withdrawal (PW) or retiree life annuity (RLA) method upon retirement

“The PW offers a retiree a lump sum and regular monthly or quarterly pension payments throughout an estimated life span. In contrast, the RLA provides periodic payments to a retiree during his lifetime.”

Over 9,920 request for retirement benefits was approved for the PenCom in the first quarter of last year says Pencom.

According to the commission, a certain amount was approved for lumps and monthly annuity payment

.

PenCom also said it approved PFAs to pay N12.72 billion to 13,126 RSA holders under 50 who lost their jobs and could not secure new employment within four months, representing 25 percent of their RSA balances”.

In addition, the organization “granted approvals to pay organizations to the administrators/legal beneficiaries of 5,562 deceased employees and retirees in the sum of N15.79 billion during the period, indicating that the CPS provides financial security during retirement and temporary loss of employment”

“The CPS also provided for a minimum pension guarantee (MPG) as contained in the PRA 2014, which is a provision for all individuals who have contributed for some years but have not accumulated enough to have a minimum pension,” the organization said, adding that it is woorganizationermine the minimum pension and effect implementation.

“Furthermore, the CPS has generated a pool of long-term funds that have been invested in the economy, with N15.27 trillion generated as of January 31, 2023.

“The CPS has directly facilitated the transfer of resources over time and the pooling of funds efficiently, significantly impacting capital formation, investment, and GDP growth.

“The CPS is necessary due to the challenges associated with the old DBS, including coverage, funding, transparency, and inability to pay retirement benefits, leading to the accumulation of enormous pension liabilities that are yet to be fully settled.”