Pension assets rise 1.41% in January against December
By Jeph Ajobaju, Chief Copy Editor
Assets of the Contributory Pension Scheme (CPS) increased month-on-month (MoM) to N13.61 trillion in January 2022 from N13.42 trillion on 31 December 2021, a difference of 1.41 per cent which translates to N190 billion.
The National Pension Commission (PenCom) disclosed this in its latest report where it also said pension operators have invested N8.35trillion in Federal Government securities, and N2.28 trillion and N123.4 billion in mutual funds.
The Pension Funds Operators Association of Nigeria (PFOAN) gave an assurance in the report that safety and transparency are built into the scheme.
“The CPS which Nigeria currently practises has inbuilt checks and balances embedded into the system. The model is such that the Pension Fund Administrators who administer and make investment decisions do not have custody of the funds,” the PFOAN explained.
“The custody of all the pension funds are held with separate and independent entities – the Pension Fund Custodians [PFC]. These PFCs are owned by four of Nigeria’s largest banks.
“Furthermore, these banks give irrevocable guarantees on pension funds held in their custody, so if anything happens to the fund’s while in their custody, it will be refunded by the parent organisation.”
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Guarantee on funds
There is a guarantee on all funds contributed outside of possible diminution by investment activities, PFOAN said in the report, quoted by The PUNCH.
“The summary of this section is that the CPS as currently practised in Nigeria has inbuilt checks and balances and administrative safeguards unlike the previous Defined Benefit Scheme run by the government that is opaque and prone to corruption.
“The CPS is one scheme that we can point to that is institutionalised and not based on the whims of individuals.”
The PUNCH adds that the Pension Reform Act also mandates pension operators (PenOp) to hire compliance officers who will ensure compliance with industry regulations as well as the internal rules of PenOPs.
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