ECONOMY · INSURANCE

CONTRIBUTORY PENSION SCHEME: PenCom orders PFAs’ to implement enhancement_Ehiabhi Femi

The National Pension Commission has directed the Pension Fund Administrators to implement pension enhancement for retirees on programmed withdrawal under the Contributory Pension Scheme.

PenCom said in a statement that this would be the second edition of the pension enhancement for retirees on the programmed withdrawal mode of retirement.

It stated, “The pension enhancement is for Contributory Pension Scheme retirees who have accumulated significant growth in their Retirement Savings Accounts and retired between July 2007 and December 2017.

“Accordingly, the retirees referred to above are by this notice advised to contact their respective Pension Fund Administrators to confirm their eligibility and complete requisite documentation.”

It would be recalled that in January 2017, PenCom implemented the first pension enhancement plan for the programmed withdrawal retirees.

However, some retirees were not entitled to the increase due to low balances in their RSAs.

PenCom stated that it had concluded the exercise and increased the monthly pension of all retirees on the programmed withdrawal due to the income earned on investing their pension assets.

The outcome of the exercise showed that 30 per cent of the retirees did not benefit from the increase due to insignificant income earned on the small balances in their respective RSAs, the commission stated.

Latest figures from PenCom revealed that the number of retirees receiving their pensions under the programmed withdrawal contracts increased by 3.81 per cent from 214,538 as of the end of the first quarter of 2019 to 222,712 in the second quarter.

A sectorial breakdown showed that 65.75 per cent of those that received pensions under the programmed withdrawal were from the public sector while retirees from the private sector accounted for the remaining 34.25 per cent.

It added that in the second quarter of 2019, about N20.57bn was paid to 8,174 retirees as lump sum and N355.09m as monthly programmed withdrawals.

From inception to date, N580.05bn has been paid as lump sum and the monthly programmed withdrawal amounts to N9.50bn.

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