The failure by some employers to remit the pension contributions of their workers to Pension Fund Administrators is creating panic about the sustainability of the contributory pension scheme as many retiring workers are finding out that there is nothing in their Retirement Savings Accounts.Investigation by our correspondent revealed that contrary to the provisions of the Pension Reform Act, 2004, which established the new scheme, many employers had failed to remit the monthly deductions from their employees emolument to the PFAs chosen by the workers.The problem of non-remittance of contributions, according to analysts, is the greatest challenge confronting the National Pension Commission in the implementation of the PRA.Complaints by contributors, who only got to know that there was nothing in their RSAs after they had changed jobs or retired, had been mounting lately with PenCom forced to look into them.A similar situation led to the demise of the former pension scheme as the government and employers were not funding the workers accounts, raising fears that the new scheme might suffer a similar fate. A contributor who works with a private firm, Mr. Adeleke Onabajo, in a complaint sent to THE PUNCH said, "I lost my job last December and up till now I have not got another. The problem is that my former employer failed to remit my eight-month pension deductions to my PFA, thereby preventing me from applying for 25 per cent withdrawal as provided for in PRA."Another former employee of the Nigerian Postal Service, who lodged a similar complaint and forwarded copies of her payslips showing pension deductions, said, "Several years of regular deductions from my monthly emolument have not reflected in my RSA with my PFA."PenCom, however, disclosed that it had addressed 10,068 cases of non-remittance of workers pension contributions mostly by private sector employers in 2010 alone.It also imposed monetary penalties on 2,616 organisations for continued violation of the provisions of the PRA, while it censured 292 others for the same offence.The Director-General, PenCom, Mr. Muhammad Ahmad, said in order to ensure compliance, the commission had applied various strategies ranging from public enlightenment and awareness campaigns, on-site visits to employers, mailing of compliance letters to eligible organisations, collaboration with regulatory and professional bodies and application of sanctions."Measures introduced to address this are already yielding results as funding of the RSAs, which hitherto was a challenge for many organisations, had improved. In this regard, the sum of N5.17bn was remitted into the unfunded RSAs of 10,068 private sector employees in 2010."The Act states that the employer and the employee should both contribute 7.5 per cent of the workers monthly emolument to the workers chosen PFA.According to Ahmad, where an employer fails to remit pension contributions of its employees, the concerned employees should complain directly to the commission.He said the name and address of the defaulting employer should be provided to enable PenCom to engage the organisation without compromising the confidentiality of the complainant.The PFAs, he added, were also submitting regular reports on defaulting employers. He, however, said the PFAs owed the contributors the duty of sending regular statements of account to enable them to know if their accounts were being funded or not, while the workers should lodge complaints if they were not receiving notifications on how their accounts were being run.
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