Out of the 9.27 million Retirement Savings Accounts (RSAs) recorded as at December 31, 2020 under the Contributory Pension Scheme (CPS), about 3.5 million accounts have irregular funding procedures, the National Pension Commission (PenCom) has said.
The Commission while bemoaning this development said majority of these irregularly funded accounts belong to employees of state governments and private sector organisations.
PenCom which disclosed in a report, noted that the 3.5 million randomly funded accounts were either remitted occasionally or not remitted at all.
The Commission said it retained the services of Recovery Agents (RAs) for the retrieval of outstanding pension contributions and penalties from defaulting employers. The RAs were required to review the pension records of the employers and recover outstanding pension contributions with penalties.
“During the year under review, the sum of N1.42 billion was recovered by the RAs from 79 defaulting employers, bringing total recoveries made from the inception of the exercise in 2012 to December 31, 2020, to N18.27 billion. The figure represents principal contributions of N9.43 billion and penalties of N8.84 billion. The amounts recovered had since been credited to the respective RSAs of the employees.
“In the same vein, the Commission continued to take legal actions to recover pension contributions from 26 defaulting employers who failed to remit outstanding pension contributions and penalty as established by the RAs. In the meantime, a significant number of employers have initiated the remittance of their outstanding liabilities in response to final demand/pre-action notices served on them by the Commission,” the report stated.
Further analysis of the report revealed that as at the second quarter 2021, out of the 10 states remitting both employers and employees pension contributions, six of which are; FCT, Osun, Delta, Ekiti, Ondo and Anambra have a backlog of remittance.
Commenting on the status of implementation of the CPS and other schemes by the states of the federation, PenCom, “As at Q2 2021, 25 states of the federation had enacted pension laws on the CPS, while seven states (Kwara, Plateau, Rivers, Borno, Akwa-Ibom, Bauchi and Katsina) were at the bill stage. Out of the five states operating other pension schemes, four states (Jigawa, Kano, Gombe and Zamfara) have adopted the Contributory Defined Benefits Scheme (CDBS), while one, (Yobe state) operates the Defined Benefits Scheme (DBS).
Speaking on measures to drive compliance in states, PenCom stated that it carried out sensitisation workshops, capacity-building programs, and stakeholder engagement meetings during the quarter under review.
The Commission highlighted the meetings and activities include; a meeting with the Executive Governor of Plateau state to review the steps taken by the state towards implementing the CPS.
Also, an interactive meeting was held with the newly constituted Bayelsa State Technical Committee on the implementation of the CPS. The meeting was to guide the committee on the road map to executing the CPS.
There was also engagement meetings with the Executive Governors of Edo, Ondo and Osun states and an enlightenment workshop on the RSA Transfer System for employees of the National Orientation Agency, Ilorin.
The report added that PenCom had a virtual sensitisation/enlightenment workshop on the workings of the CPS for the management and staff of the Livestock Feeds Plc, adding that a two-day workshop for Pension Desk Officers of the six Area Councils and Local Government Education Authorities of the Federal Capital Territory (FCT), Reconciliation Committee, and the FCT Area Council Pension Board staff, was organised and the workshop guided the participants on how to detect incorrect/shared Personal Identification Number (PIN) in pension contribution schedules.
“An enlightenment programme on the workings of the RSA Transfer System (RTS) was held for the management and staff of the 13 Ministries, Departments and Agencies (MDAs) of Ekiti state, and the programme clarified participants on the workings of the RTS as well as the importance of data recapture.
“An enlightenment programme on the CPS was organised for the management and staff of the Federal Character Commission, National Human Rights Commission, Lafarge Africa Limited, and the Senior Staff Association of Chemical & Non- Metallic Products Limited. The programme touched on the role/responsibilities of the employees, employers and the modes of withdrawal, amongst others,” the report explained.
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