Chineme Okafor in Abuja
The federal government and stakeholders in Nigeria’s pension industry have begun discussions on the possibility of investing a portion of the industry’s accumulated financial assets worth about N5.39 trillion into the country’s power sector and other infrastructure, THISDAY has learnt.
THISDAY gathered from the Managing Director of Sigma Pensions Ltd, Mr. Umar Modibbo during a recent meeting in Abuja that the industry’s discussions with the government have largely been driven by the Minister of Power, Works and Housing, Mr. Babatunde Fashola.
Modibbo stated that Fashola was recently invited to attend a retreat by the industry stakeholders, where issues regarding the possibility of the industry investing part of the financial assets it accumulated from the contributory pension scheme in the power sector. He said subsequent discussions have then followed on the issue.
“We had a discussion sometime last year when the minister was invited to our retreat. We are generally talking with him on infrastructure because the pension industry is generally amenable to investing provided we have the right instruments and guarantees that the monies we will put in will be returned, that is the major consideration, the moment these issues are sorted, I don’t think the industry will have any problem investing in the sector,” said Modibbo.
Nigeria’s Pension Commission (PenCom) in March, 2016 reportedly disclosed that the total pension fund assets accumulated since the pension fund Act was reviewed has grown to N5.39 trillion.
Even though the government had requested that it invests parts of its financial assets to bridge gaps in the country’s infrastructure, the industry has asked that a structured product be developed by the government on which it could invest its funds.
Modibbo also spoke on other developments in the pension industry including moves by PenCom to introduce new products to take care of people who may be interested in saving but are not within the formal sector.
“For the pension industry, although there are challenges, it is something that is very sustainable because the contributory pension scheme is very structured and sustainable.
“The only thing is that we need to expand the coverage by introducing the micro pension so that people who are not served can be brought into it. Those people who are not fully employed by the formal sector but are active and generating income and need to save for the rainy day as well,” he said.
He stated on the customer service survey which his company conducted and from which customers were selected and rewarded with gifts: “It was a culmination of a process we started, we ran a customer survey and decided to reward those that participated in the survey. Three people won from Oyo; Niger and Delta, and we brought them here to reward them with mini IPads.”