News Column

Premium Pension Hails New Pension Law

July 14, 2014

Nnamdi Duru

Premium Pension Limited, one of the Pension Fund Administrators (PFAs) in the country, has commended President Goodluck Jonathan for signing the Pension Reform Bill, 2014 into law.

The Managing Director of the company, Mr. Wilson Ideva, who disclosed this, noted that the new pension law repealed the Pension Reform Act, 2004 which served as the foundation of the contributory pension scheme in the country.

"The new pension law further concretises the statutory foundation of the pension industry and positions it for the attainment of even greater heights. The industry is now set to witness unimaginable growth; such that has never been seen in any sector of the Nigerian economy.

"With the provisions of the Pension Reform Act, 2014, the pension industry in Nigeria is the subsector to watch in the course of national development in the coming years. The industry is already well-positioned to assert its centrality to social and economic development," he said.

Under the ten years old contributory pension scheme in the country, 6.4 million Nigerian workers have opened Retirement Savings Accounts with over N4.3 trillion being managed by licensed PFAs.

The Premium Pension boss also stated conviction that the new law would enhance the retirement savings fund management business and the Nigerian economy in general.

"It is expected that when the new pension law is fully applied, majority of the country's working population, be they in the public or private sector or even artisans would be covered by the scheme," Ideva said.

The new pension law, among other things, enhances the enforcement responsibilities of the regulatory institution, National Pension Commission (PenCom), ensures further airtight protection of pension funds and unpacks guidelines and possibilities of creatively and professionally applying pension funds for national development.

It allows the creation of additional permissible investment instruments to accommodate initiatives for national development such as investment in the real sector and infrastructure and seeks to expand the dragnet of the scheme to include the informal sector.

It also established the Pension Transition Arrangement Departments (PTADs) that is charged with the responsibility of ensuring the seamless remittance of benefits under the Defined Benefits Scheme.

In addition, the law raises the employer and employee contributions in the scheme from a total of 15 per cent to 18 per cent of monthly emolument.

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Source: AllAfrica

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