- To boost financial inclusion, better life for workers
By James Emejo in Abuja
President Muhammadu Buhari has launched the Micro Pension Plan, assuring pensioners of prompt payment of their entitlements.
He said the scheme was part of his administration’s efforts at ensuring that Nigerians who worked hard during their active years in service of their fatherland live in dignity and retire without any cause for alarm.
Speaking at the launch of the Micro Pension Plan, which was initiated by the National Pensions Commission (PenCom) in Abuja Thursday, he further assured the pensioners that the federal government remained committed to payment of pensions notwithstanding the presently fiscal constraints.
The scheme is designed to also incorporate workers in the informal sector of the economy.
Buhari, therefore, appealed to traders, unions, non- governmental organisations and other stakeholders in the informal sector to collaborate with the government to enlighten their members of the benefits of the micro pension plan.
The micro pension scheme targets the significant majority of Nigeria’s working population who, incidentally, operate in the informal sector.
However, informal sector workers including market women, members of the road transport workers, textile, garment and tailoring associations are expected to take advantage of the opportunity provided by the scheme to secure their life after work.
Other target population include tricycle operators and okada riders associations, butchers associations, workers in the movie and performing art industry, mechanics and workers in the automotive industry as well as single professionals like lawyers and accountants among others.
Buhari said the federal government understood the importance of the pension industry, adding that this was why the micro pension plan was conceived to afford operators in the informal sector something to fall back on when they retire from active service.
He said his administration had within the past three years, provided grants, technical support and loans to small businesses, thereby effecting positive changes in their lifestyle.
The president further directed that as part of government’s support towards the successful implementation of the initiative, the Financial System Strategy 2020 should be designed to support the micro pension plan through its financial inclusion programmes.
Earlier, the acting Director General, PenCom, Aisha Dahir-Umar, explained that under the plan, 40 per cent of the amount contributed could be accessed for contingency purpose, while the balance of 60 per cent would be set aside for retirement benefit.
She said contributors could draw from their 40 per cent contribution after three months of making the initial deposit, while the 60 per cent balance could only be accessed at the age of 50 during retirement.
According to her, the implementation of the plan will among other things reduce poverty at old age by 85 per cent.
She said: “This event is remarkable because it unveils a unique financial product, which democratizes the savings culture in Nigeria in a systematic and efficient manner.
“The product also perfectly aligns with the current social empowerment programmes of the federal government as it seeks to ensure, in the long term, the sustainability of the benefits of the empowerment programmes for the participants, who may seize this opportunity to save for their old age.
“Our objective is to ensure efficiency and effectiveness in service delivery as well as transparency and accountability in the administration of the product by licensed pension operators.”
According to her, “With the formal launch and subsequent successful implementation, the Micro Pension Plan is expected to significantly expand pension coverage to greater number of Nigerians and further generate additional long term funds for Nigeria’s economic development.
“The commission would collaborate with relevant stakeholders to sensitise and enlighten the target participants and the public on the features and benefits of the micro pension plan.”
The Secretary to the Government of the Federation, Mr. Boss Mustapha, also expressed confidence that the scheme will expand pension fund coverage to the informal sector.