PFAs Pay N1.63tn Lump Sum to 442,000 Retirees in 15 Years

Festus Akanbi

The Pension Fund Operators Association of Nigeria (PenOp) said that the pension industry paid N1.63 trillion as a lump sum to 442,000 retirees as of the second quarter of the year.
It also said they were paid through programme withdrawals and annuity products.
PenOp serves as the umbrella body for Pension Fund Administrators (PFAs) in Nigeria, which ensures the smooth operation of the pension system in the country.
Chief Executive Officer (CEO) of PenOp, Mr Oguche Agudah, said this at a media parley with the theme: “At the Dawn of 20 Years of Pension Reform, what are the Gains?” held in Lagos.
During the same period, N665.13 billion was paid to 111,708 applicants in lump sum payments for life annuities while N964.24 billion was disbursed to 330,201 retirees.

The CEO said that under the reformed pension scheme, 475,000 Nigerians, who lost their jobs, received 25 per cent of their Retirement Savings Accounts (RSAs), amounting to N208.86 billion.
Agudah said that the pension industry also prioritises the well-being of the beneficiaries of deceased employees.
He noted that under the period review, N356.32 billion was paid out as death benefits to 91,214 beneficiaries, compared to N6.31 billion disbursed to 2,896 beneficiaries in the same period in 2011.
He further said that the industry had responded to the housing needs of pensioners by treating 649 applications and approving N7.89 billion payment for equity contributions towards residential mortgages.

According to him, the Asset Under Management (AUM) for the pension industry as at the period amounted to N17.35 trillion.
Agudah said the figure reflected a Compound Annual Growth Rate (CAGR) of 20.32 per cent since 2007 when the AUM stood at N815.18 billion.
He explained that the contributions from the public and private sectors had increased, reaching N9.37 trillion in the second quarter of 2023.

This, he said, represented a 54 per cent rise, noting that the PFAs had invested N7.98 trillion, resulting in a 46 per cent investment return.
He noted that the pension fund was doing a lot in infrastructure, equity market and corporate debt securities.
The PenOp boss said since its establishment in 2004, the pension industry had been subject to robust regulation and protection, ensuring transparency and accountability within the scheme.

These measures, he maintained, had contributed to the industry’s success in safeguarding pension funds and providing retirees with reliable income streams.
“The pension industry in Nigeria has recorded enormous transformation and progress in the last twenty years,” he said.
In his remark, the Head of the Surveillance Department, National Pension Commission (PenCom), Dr Ehimeme Ohioma said that adequacy and sustainability are the two key critical to the success of the pension industry.

“Monthly pension must be adequate to sustain the pensioners after retirement for a long period.

“We must also ensure that the pension fund earns good Return on Investment (ROI) and the RoI is above the inflation rate,” he said.

Ohioma noted that the pension scheme had come to stay and could not be reversed because the industry players had maintained a high standard over time to sustain the successes achieved.

He stated that in 2024, the industry would improve its service delivery, upgrade the skills of its professionals and invest the pension fund in more secured investment portfolios.

Money Not Missing in NPA, Says MD, Bello-Koko

Festus Akanbi

The Managing Director of the Nigerian Ports Authority (NPA), Mohammed Bello-Koko, has said no money is missing from the authority’s coffer.
Reacting on his personal X handle, @mohdbellokoko, to a report that $1.8billion is allegedly missing from the agency’s coffer, the NPA boss, stated that the amount wasn’t missing but a bad debt.

He stated further that some of the debts also arose from the defective concession agreement of 2006, which he said would be corrected in the reviewed lease of agreement that would come into force soon.

“The larger part of the amount in question here is actually not missing; it is more like bad debts – some concessionaires have been given, say, a 1000-metre quay length area and a 2-hectare staking area for quayside operations. If 200 metres out of the 1000 metres quay length are defective and unusable, logically, the concessionaire will not pay for the unusable 200-metre area,” Bello-Koko stated.
Even though the Senate asked the authority to recover the debt, Bello-Koko said the debt must be written off the authority’s book and start the new year on a clean slate.

He said: “However, the Senate demands the NPA recover the money for this space that was not used. Over the years, these encumbered spaces have accumulated and run into millions of dollars. But literally, they are bad debts that cannot be recovered. Important to note, some of these debts date back over 20 years to the pre-concession regime.

“Some of the debts also arose from the defective concession agreement of 2006. Nonetheless, in the reviewed agreement, which will come into effect soon, these defects have been corrected.
“As I mentioned to the Senate Committee on Public Accounts of the 9th Assembly, we need to write it off our books and start the next year on a clean slate.”