ABSTRACT
This research work is on the
problem and challenges of Nigeria contributing pension scheme to Nigeria civil
servants specifically as it effect regular payment of pension, arrear/debt of
pension, issue of ghost pensionnaire, effect of change of jobs and pension
administrator and the level of implementation and supervision of rules,
regulation and standards in the industry.
The researcher employed
questionnaire, chi-square for the research work. This method was applied
because information could be source from Nigeria Civil Servants PenCom workers
and pensionnaire retirees.
The result indicate that payment
of pensionnaires are not regular, arrears/debt of pensionnaires has not been
cleared, issued of ghost worker are still not cleared, and low level
implementation and supervision of rules and regulation of PenCom; all these
constitute problems and challenges for PenCom and pensionnaires.
Finally, Having found the above
problem and challenges of Nigeria pension scheme to Nigeria Civil Servant the
researcher recommended that an institution should be build to train staff to
handle pension matter and serious measure should be taken to fish out ghost
workers and pay arrears of pensionnaires.
CHAPTER ONE
1.0 BACKGROUND OF STUDY
1.1 INTRODUCTION
The
Nigeria Pension Schemes exist to provide post- retirement benefits to
employees. It was introduced by the colonial master to provide income and
security for old age British citizen working in the country upon retirement.
According
to Adesina B. (2006:7) Nigeria first ever legislative instrument on pension
matters was the pension ordinance of 1951, which had retrospective effect from
1st January, 1946. Then followed by the National Provident Fund (NPF) scheme
established in 1961 was the first legislation enacted to address pension
matters of private organizations. Pension Act No. 102 of 1979 came up 18 years
later, as well as the Armed Forces Pension Act No. 103 of the same year. In
1987 Police and other Government Agencies’ Pension scheme was enacted under Pension
Act No 75. This was followed up by the Local Government Pension Edict which
foresaw the establishment of the Local Government Staff pension Board of 1987.
By
1993 the National Social Insurance Trust Fund (NSITF) scheme was established by
Decree No. 73 of 1993 to replace the defunct NPF, in 1994 employees in private sectors were equally accommodated by the scheme, for lost of employment income in old age, invalidity or death.
Most
pension schemes in the public sector have the problem of been poorly funded or
unfunded, owing to inadequate budget allocation. This situation resulted to
outstanding pension deficits of about two trillion naira before the
commencement of the Pension Reform Act of 2004 (PRA). A part from this the
administration of the scheme was generally weak, inefficient and non
transparent. There was no authenticated list/data base on pensionnaires, while
14 documents are required to file pension claims. Also there was a restrictive
and sharp practice in the investment and management of pension fund, this
created the problem of pension liabilities to the extent that pensionnaires
were dying on verification queues and over three hundred parastatals schemes
were bankrupt before the new scheme came on board.
On
the issue of private sector, most employees were not covered by any form of
retirement benefit arrangements. Most of their pension schemes were that of
resignation rather than retirements. Therefore at that period the pension
schemes in Nigeria were largely unregulated, without standard or supervision
and highly diversified before the
advent of the PRA 2004. Meanwhile, before the enactment of Pension Reform Act
of 2004, there were three regulators, namely Securities and Exchange Commission
(SEC,) National Insurance Commission (NAICOM) and the Joint Tax Board (JTB).
(Ahmad M. K. 2006:2).
Moreover,
the Pension Reform Act of (2004), according to Atedo N.A (2006:19) ‘the Act’ a
compulsory contributory pension scheme (“the scheme” or “CPS”) has been
established for all categories of workers in the Federal Capital Territory,
Federal Public Service and in the Private Sector. This scheme waved the era of
pay-as-you-go and put in place a full funding of scheme which is compulsory for
all. It provides the categories of schemes to apply to the National Pension
Commission (‘Pension’) to continue but be managed according to the Act. The
major differences between the new and previous scheme are under the
Contributory Pension Scheme (CPS) employer and employees make founded
contributions into a Retirement Savings Account (‘RSA’) for the benefit of the
employee or his legal beneficiaries under the CPS, PenCom is the sole regulator
for all pension funds they are required to be managed and administered by
private owned and licensed PFAs selected by each employee, while the PFA
appoints the PFC to be in charge and responsible for the assets as a
third party. PenCom also issue guidelines for the investment of pension fund.
Each employee is to receive pension for life for which he/she contributed for
under CPS.
Based
on the foregoing, the researcher is to study the challenges and problems of
Nigerian contributory pension scheme to Nigeria Civil Servants......
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