Fed Govt yet to implement 18% pension contribution
By NGOZI Onyeakusi —-
The National Pension Commission (PenCom), has expressed dissatisfaction that three years after the Pension Reform Act 2014 mandated an upward review of the amount required by employers to be contributed into the Retirement Savings Accounts (RSA) of their employees with their Pension Fund Administrators, the Federal Government is yet to comply with the regulation.
The Head, Research and Corporate Strategy Department PenCom), Dr Farouk Aminu regretted that ten years after, the PRA 2004, was amended and replaced with the PRA 2014, and raised the employeeâ€™s and employerâ€™s contributions to eight per cent and 10 per cent, from 7.5 per cent respectively of the total monthly emolument of the worker, thus putting the total contribution at 18 per cent from previous 15 per cent, the Federal Government was still defaulting in playing its part.
Aminu, while answering questions from journalists lamented that government makes law for making sake adding that when a law is made and was not implemented, it is good as not making it at all.
“In it the federal government proposed 10 per cent employer contribution and eight per cent employee contributions. Now if you look at private sector and some public agencies, they
are all implementing but to date from July 2014 to where we
are today three years after, federal government is yet to implement the 10 per cent employer contribution, because as I am saying make a law so that that law is implementable, we don’t make law just because we want to make a law, you make a law because it’s possible that you can implement it. You make a law but that cannot be implemented what is the use of that?. Now The 10 per cent employer contribution the federal government cannot pay not to talk of adding so much burden on the government.
He said PenCom was worried that till now the Federal Government was yet to implement the 18 per cent pension contributions as revised by the PRA 2014.
He lamented that the major problem of the government was not having the right people and the right place.
“When you are doing a law on money that government is going to spend I think that there is always a need to also contact the relevant agency of government in charge of budget and finances before you put a burden on government.
Discuss with ministry of finance, discuss with the Budget office of the federation, discuss it with the accountant general of the federation and do an analysis on how this could be possible and it can be financed and sustain”, he said.
Aminu reiterated the need for the Federal Government to ensure adequate appropriation under its recurrent expenditure in order to facilitate the implementation of the new pension contributions rate.
He further stressed the need for the government to adequately appropriate funds for the payment of its pension liability under the Contributory Pension Scheme.