Juliet Akoje in Abuja
Various stakeholders yesterday called for the exemption of the Nigeria Police Force from the Contributory Pension Scheme (CPS).
This was during a public hearing on two pension bills namely The Bill For An Act To Amend The Pension Reform Act, 2014 To Provide For The Exemption Of The Nigeria Police Force From The Contributory Pension Scheme And For Related Matters; and A Bill For An Act To Amend Sections 1(C), 7(2), 8(1), 18, 24 And 99 Of The Pension Reform Act, Cap P50 Lfn 2014 by providing that a pensioner shall receive at least 75 per cent of his retirement benefits immediately upon retirement and criminalise the undue delay in the payment of pensions and for related matters.
The public hearing, which was organised by the House of Representatives’ Committee on Pensions, was sponsored by Hon. Francis Ejiroghene Waive, who said that operating under the current pension scheme has been both unpalatable and regrettable for the retirees of the Nigerian Police Force.
He argued that the police be exempted from the scheme just like the armed Forces and the Department of State Services (DSS).
Waive said: “For example, the highest retirement benefit of a Deputy Superintendent of Police under this obnoxious pension scheme is N2.5 million and that of Assistant Superintendent of Police is N1.5 million while their equivalent in Army (captain) and DSS are paid N12.8 million and N10.3 million respectively.
“Upon retirement, the monthly take-home of a retired police DSP is just N31,600 while that of a Captain an equivalent in the army is N180,000. While a police Inspector is N15,000, a warrant Officer, the Army equivalent to a Police Inspector takes home N120,000. Ladies and gentlemen, what is good for the goose is good for the gander.”
He said in these days of insecurity across the nation, exempting the police from the obnoxious contributory pension scheme could just be the magic to motivate officers and men of the force to go the extra mile and save the country.
The Inspector General of Police, Mr. Usman Alkali Baba, said the police should get equal treatment with the armed forces and other intelligence services, especially as the lead agency, saddled with the responsibility of maintaining internal security, law and order in the country, with attendant risk and sacrifices, including the supreme sacrifice.
Represented by Deputy Inspector General of Police, Mr. Sanusi Lemu, he said the unpleasant experiences of retired police officers under the present scheme has the tendency not to motivate officers and men and also serve as incentive for corrupt practices in a bid to avoid similar fate upon eventual retirement.
He said the leadership of the Nigeria Police Force is convinced that the amendment being proposed would not only significantly address the age-long challenges associated with the pension administration in the force, it would be in the overall best interest of the entire members of the force, both retired and serving police officers.
The majority of stakeholders at the public hearing backed the exemption of the police from the scheme.
But the Nigeria Labour Congress (NLC) opposed the exemption of the Nigeria Police from the Contributory Pension Scheme (CPS).
The union said this would imply additional financial burden on the federal government by way of unsustainable pension obligations.
The Director General of the Nigeria Pension Commission (PENCOM), Ms. Aisha Dahir-Umar, also opposed the exemption of the police, saying all their issues could be resolved within the scheme.
Presenting the position of the NLC at the hearing, Hon Uche Ekwe, said if the agencies of government are being exempted from the CPS, then it should not be forced on others.
He lamented: “Where will the money to fund the defined benefits scheme for the exempted officers come from? Will it still be funded from the national budget that currently is hardly sufficient to fund other commitments of Government, including healthcare and social security?
“What has changed in the management of DBS especially in the light of news of arrests and convictions of individuals involved in the mismanagement of pensions?”
The NLC said government would be unable to sustain pension payment under the DBS.
He said: “This is because exemption of the personnel of the NPF would imply additional financial burden on the federal government by way of unsustainable pension obligations. Statistics from the pension industry indicates that the federal government would need over N1 trillion to finance the exemption of the police personnel from the CPS. This liability is expected to significantly increase with the proposed yearly recruitment of 10,000 personnel into the police force as announced by the federal government. The federal government is already overburdened with the payment of pensions under the Defined Benefits Scheme as illustrated by the 2022 Appropriation Act, which made a provision under the Service Wide Vote for the sum of N577.3 billion as total allocation for pension and gratuities.
“The NLC, therefore, recommends without trepidation, that the issues of inadequacy of retirement benefits in the Retirement Savings Account (RSA), which is always posited by the proponents of the exemption of the Nigeria Police, could be sufficiently addressed within the framework of the CPS.
“The NLC accordingly calls on the government to enhance the salary of the Nigeria Police personnel and restore the payment of gratuity to workers upon their retirement. Incidentally, gratuity has not been abolished by the PRA 2014.”
The NLC also opposed the amendment of the Pension Act to enable pensioners collect 75 percent of their pension upon retirement.
“The NLC notes the objectives of the proposed amendment, which are to provide for definite percentage that a retiree can withdraw from the Retirement Savings Account (RSA) and to criminalise undue delay in payment of pension. Indeed, the NLC identifies with the struggles of the retirees as they pertain to the delay in the payment of benefits after retirement and the inadequacy of the lump sum at retirement.
“Labour does not share the view that the solution to these problems resides in allowing the retiree to withdraw at least 75 per cent of the balance of the RSA upon retirement. This is because that scenario would mean leaving only 25 per cent to be spread over the lifespan of a retiree. It is doubtful if the 25 per cent balance in a retiree’s RSA, after deduction of 75 per cent lump sum, would, if spread through the retiree’s expected life span, be adequate to reasonably cater for his livelihood during old age.
“It would result in the depletion of the RSA without regard for the retiree’s continued subsistence, thereby impoverishing retirees. This will defeat the essence of pensions and the objectives of the CPS.
“It is in the light of the foregoing that the NLC maintained the position that the Federal Government should restore the payment of gratuity as well as adequate funding and timely release of accrued pension rights of retirees under the CPS,” the NLC said.
The director general of PENCOM said exiting the CPS by the police is not the solution because pension is a function of salary. She said as long as the police salary remained poor, their pension under any scheme would be poor.
“The reason the police has always failed to exit is that because the police employer (FG) has found out that the resolutions to the challenges the police is facing are all administrative and are surmountable without exiting the CPS. They can be addressed within the framework of the CPS. The government has seen that there is no need to exit a successful scheme that is why it has continuously rejected to approve it,” she said.
She also opposed payment of 75 percent of pension upon retirement.
