24 February 2013

Nigeria: Pension Fund Management and Plight of Pensioners


While Nigerians focus their attention on the alleged multi billion naira fraud in the pension management and the on-going probe by the National Assembly in this regard, pensioners continue to groan over their situation which has worsened due to lack of prompt and effective payment of their monthly entitlements. RUTH CHOJI reports.

The pension scheme has undergone different reforms after the first Pension Ordinance of 1951. The civil service pension scheme which was established by the Basic Pension Decree 102 of 1979 has gone through changes that have ended up compounding the problems of pensioners and now the pensioners are demanding for complete autonomy to manage their pension.

Speaking to LEADERSHIP SUNDAY on some of their challenges, a pensioner Mr Adeyemi Abiola, who retired 11years ago, stated that "We pensioners fared better under Obasanjo than the Goodluck administration. Most of us have not been paid for months, even when we have presented our papers for verification, they still refuse to pay us. I haven't received my pension for three months now. Last month I got an alert but when I got to my bank, the account was empty.

Some of my mates have been paid, but some of us were told that they can't find our names in the system and we all did the biometric verification exercise organised by the task force. So where is my money? I served this country faithfully for 35years and now I can't assess my pension? It is not fair, nobody cares, all we hear is big money being released by government for pension, but none of us get to see the money."

Madam Cecilia Alimi, another pensioner, said "I have been getting my pension, but not in time, it comes late, sometimes it will not come for two months. We can't go to hospital without money. Some of us still take care of our families from our pension, so when they delay it, it effects lots of people, not just us.

Sometimes they will make us come to Abuja for one verification exercise or the other; it is not easy for an aged person like me to be traveling. When you get there, you will join a long queue. Some of us have died in these queues, some used to faint. Government should find a way of making our pension payments easy. We deserve that after serving this country for years."

It is common knowledge that payment procedure for pensioners has become very tedious and sometimes the pensioners are made to wait for days, months or years to collect their entitlements. Also, the process of sharing the funds between Federal and State services and other agencies is riddled with fraud and corruption while some of them are held to ransom.

This and many more reasons led to the creation of the Nigerian Pension Reform Act that was signed into law by former President Olusegun Obasanjo on June 25, 2004. The objective of the law is to, among other things, ensure that every person who worked in either the public or the private sector receives his or her retirement benefits as at and when due to low compliance ratio and lack of effective regulation and supervision of the system by the regulatory body that government created, like the National Pension Commission (PenCom) which was established to regulate and supervise all pension matters in the country.

The scheme is being managed by licensed Pension Fund Administrators (PFAs), while the custody of the pension fund assets are provided by licensed Pension Fund Custodians (PFCs).

A staff, who works with one of the pension managers and doesn't want his name in print, stated that, "Pensioners in Nigeria suffer. Their plight is made worse due to the private sector schemes where the rigorous verification procedure and the time it takes is frustrating.

Also, the Pension Reform Act 2004 did not stipulate a time frame for PenCom to complete work and make sure that a pensioner is paid on time; bonds meant for pensioners are also not issued early. Corruption is another major problem why pensioners don't get their monies in time. Sometimes, fake accounts are open with fictitious names where monies are forwarded in the guise of pension salaries.

It is the civil servants themselves that use the money; this is very sad, because we all know that Federal Government budgets N5 billion every year for pension and not one third of this gets to the pensioners. You can see from what the PRTT are accused of, there is no way people will handle the pension funds without stealing from it, because there are lots of loop holes."

He went further to say that, the chairman, Maina, is also alleged to have incurred N240 million on the overseas verification of 20 retirees. "I think the pension scheme should be given to the National Assembly to handle because they are closer to the people than government is or it should be handed over to the private sector forthwith."

Another pensioner who spoke on behalf of the Nigerian Union of Pensioners is Comrade Ehada Mohammed, principal assistant general secretary of the Union. He states that "Pension has never been stopped at any point in time, only there was a change of baton from the PRTT to the head of service.

We were not treated well under the PRTT, so it was reverted to the head of service and they have been paying; it is just that many people have not been paid because when the head of service took over, there was no proper handing over; they did not want the head of service to take over from them, that is why they refused to hand over properly. Some were not captured in the data base that the head of service will use to pay all the pensioners. So the people they are paying now are those they got from banks when they went to collect the names."

Ehada said that there is a clamour by the union for government to hand over the affairs of pensioners to it. "When the task force come in, they did this biometric verification exercise twice, once in 2010 and the other in 2011 for the purpose of knowing all the pensioners. It was discovered that some were not on the pay roll because their names were missing. Some have not been paid for years and because they were not enrolled, they were not receiving their pension.

It is the massive corruption in the system perpetuated by public officers; they are the same people who inject in these ghost workers. Where do the names of ghost workers appear from? How do the names appear on the computers? They are the ones that write it. For example, some names would appear during the verification exercise and afterwards, the account number will be changed and the pensioner will not receive anything.

Who receives the money with his name? You will receive an alert from the bank, but when you get to the bank, the account will be empty. If you go to Head of service, they will give you the complaint form to fill, write down your complaint but nobody will do anything about it. So the fault is with pension managers. Since the task force came on board, they have never followed up on the next of kin issues; the money is already there that government has appropriated, but they keep on misappropriating it.

He stressed the need for federal government to give the union the chance to do the work "because they have failed us.

When Mr Oronsaye came in as head of service, he gave us the chance to conduct the verification and we did, because we know each other. We have three structures from the national to the state and even local government. We can get our coordinators to do this on our behalf and it will be smooth.

They jettison our efforts away because of their ulterior motive. If we had done it ourselves, there is no way they will syphon the money. The task force compounded the problem of pensioners; even those receiving their regular pensions stopped receiving it when the task force came on board.

They were using the media to deceive government that they had done 90% of the verification when they didn't do anything. We expected government to prosecute those people in the task force who are guilty, yet nothing has been done since. All we hear is this community or that one has done this or that. What the PRTT have done has impoverished many pensioners, some of them have died and left their families homeless and in difficult circumstances."

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