PenCom Approves N5.33bn as More Contributors Withdraw Pension Funds

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By Ebere Nwoji

Pension Fund Administrators(PFA) are under stress as a result of continuous demands for withdrawals by contributors into the Contributory Pension Scheme.
This is as a result of increased job losses due to harsh economic environment.
In the last quarter of 2020, the situation compelled the National Pension Commission (PenCom) to approve N5.33 billion to enable PFAs provide succor to 11,796 account holders who found themselves out of jobs.
The development was attributed to the impact of the COVID-19.
According to PenCom, a total of N5.33 billion was paid to RSA holders under the age of 50 years, who were disengaged from work and unable to secure jobs within four months in the fourth quarter of 2020.
The regulator disclosed that similar approval was granted for the payment of N4.31 billion to 8,221 RSA holders who were under the age of 50 years and were disengaged from work but unable to secure another job within four months of disengagement in the first quarter of the same year.
Available data showed that Nigeria’s unemployment rate as at the second quarter of 2020 was 27.1 per cent, indicating that about 21,764,614 (21.7 million) Nigerians remained unemployed.
Head, Corporate Communications, PenCom, Mr. Peter Aghahowa, had said workers who lost their jobs owing to the pandemic would be able to get a quarter of the savings in their Retirement Savings Accounts (RSAs) to cushion their hardship after four months of job loss.
According to him, “The contributory pension was designed to allow access to 25 per cent of retirement savings balance in a situation whereby you lose your job.
“So if you lose your job, after four months you can access 25 per cent of your RSA contribution.”
A report by the Economic Sustainability Committee (ESC), chaired by Vice President YemiOsinbajo, had projected that unemployment in Nigeria may rise to 39.4 million or 33.6 per cent in December.
It had also predicted a monthly oil revenue loss of N185 billion for the country.
The president set up the committee last year to come up with economic sustainability plan as a response to challenges posed to the economy by the COVID-19 pandemic. The committee was also constituted to come up with monetary policy measures in support of the plan; provide a fiscal/monetary stimulus package, including support to private businesses (with emphasis on strategic sectors most affected by the pandemic) and vulnerable segments of the population.
Other mandates of the committee included identifying fiscal measures aimed at enhancing distributable oil and gas revenue; increasing non-oil revenues and reducing non-essential spending towards securing sufficient resources to fund the plan; articulating specific measures to support the states and the Federal Capital Territory (FCT); proposing a clear-cut strategy to keep jobs and create opportunities for new ones as well as identifying measures that may require legislative support to deliver the plan.