New pension scheme: Lagos contribution hits N26.29bn

The total contribution into the Retirement Savings Account of Lagos employees, under the contributory pension scheme, has reached N26.29bn. The state Governor, Mr. Babatunde Fashola, disclosed this during the presentation of the fourth batch of retirement bond certificates to retirees covered under the Pension Reform Act 2004 in Lagos on Friday. He said, "We are mindful of this obligation and not only are we the first state to start the payment of the minimum wage even before the law was passed, we have not defaulted on the payment of our 7.5 per cent of the employees salary into the Retirement Savings Accounts. The total employees and states contributions credited into the retirement savings account of all employees under the contributory pension scheme as at September stood at N26.29bn."Fashola said that in the fourth batch of the issuance of retirement bonds, the state credited the RSA of 471 retirees with N2.28bn. Till date, he stressed, the state had redeemed retirement bonds of N5.82bn into the RSA of 1,121 retirees. He added, "We are working tirelessly to ensure that those of the Pension Fund Administrators that have yet to match our service expectations do so. The reason is that your comfort is our joy, and we will not be satisfied until we ensure that the peace you deserve in old age is not compromised by any operator, who by the law, is supposed to make life easy for you." The Director-General, Lagos State Pension Commission, Mr. Adekunle Hussain, said Lagos subscribed to the contributory pension scheme in a bid to find a lasting solution to the perennial problems faced by the pensioners under the Pay As You Go pension scheme, which had a defined benefit structure with benefits being based on terminal salary but with no specific requirement for full funding. Hussain added, "The CPS has a full funding structure. Contributions are religiously made monthly by the state government into the RSA, which the employees opened with PFAs of their choice." The state, he added, had also carried out an actuarial valuation exercise to determine the past service liabilities of employees, who had been in service before the commencement of the contributory pension scheme and had accrued pension rights made up of gratuity and pension entitlements up to March, 2007, when it transited into the new scheme."
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