Thursday, 10 November 2016

Nigerian retirees to earn minimun pension from nextyear


Pension DG Mrs Chinelo Amazu has reiterated that retirees under the Contributory Pension Scheme will from early next year enjoy a minimum pension payment irrespective of the balance in their Retirement Savings Accounts.

Punch learnt that the Chairman, Pension Fund Operators Association of Nigeria, Mr. Eguarekhide Longe, disclosed this to our correspondent in an exclusive interview.

“The minimum pension is going to take up early next year. We (operators) are supposed to pay three per cent of our management fees to set up the fund, the National Pension Commission is supposed to pay another fee and they have already given us a notice that we must ensure that we put that money in our budget in 2017 and that it will take up next year,” he said.

Last year, operators of the scheme proposed a minimum stipend of N14,400 for each retiree in the draft guideline on the commencement of the minimum pension for retirees under the CPS.
Longe, however, did not confirm if the minimum pension would remain the same amount.

He noted that pension operators had a responsibility to make their own contribution to the fund to kick-start the payment of the minimum stipends, while the Federal Government would also have to pay its own contribution.

“Pension operators will put forward the information of the people who are not earning up to the minimum pension stipend and they can now get the augmented amount from the pension protection fund, that is how it works,” he said.

The Pension Reform Act, 2014 provided that PenCom should establish and maintain a fund to be known as the Pension Protection Fund in respect of the guaranteed minimum pension.
According to the Act, funding of the minimum guaranteed pension will be partly obtained from an annual subvention of one per cent of the total monthly wage bill payable to employees in the public service of the federation and returns from pension fund investments.

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