PenCom seeks reconciliation of non-credited contributions
• Threatens sanctions against non-submission of status reports
• Directs PFAs to implement pension enhancement for retirees
The National Pension Commission (PenCom), has called on the State Pension Bureaux (SPB), to establish a Reconciliation Unit (RU), or Standing Reconciliation Committee (SRC), to resolve the issue of non-credited pension contributions to employees Retirement Savings Accounts (RSAs), after remittances have been made.
According to the Commission, this would help tackle the issue of loss of profits on employees’ RSAs, which would have been gained if their contributions were remitted and credited as and when due for investments.
Specifically, the Acting Director-General, PenCom, Aisha Dahir-Umar, said the Commission has engaged its the officials through various stakeholders’ meetings to resolve the issue of non-credited contributions, amongst others.
She said that one of the resolutions and key communiqué items from last year’s 3rd Quarter Consultative Forum was that SPB should establish an RU or SRC to work with the Pension Fund Administrators (PFAs), to address the pending issues.
Speaking with The Guardian, Dahir-Umar, said the Commission has embarked on a routine inspection of the SPB and PFAs, to reconcile and address cases of non-credited pension contributions of state employees.
She warned that PenCom would apply appropriate actions as outlined in the Sanctions Regime against defaulting operators, who failed to comply with the mandate to submit a monthly status reports to the Commission.
She noted that using the established regulatory procedure, the sanctions range from monetary penalties to withholding of monthly management fees due to the operator until the issues were fully addressed.
Her words: “Pursuant to Section 92 of the Pension Reform Act (PRA) 2014, the Commission conducts inspection or examination on Pension Fund Operators (PFOs) at least once in a year to ensure compliance with the provisions of the PRA 2014 and extant regulations issued by the Commission.
“After the examination, the Commission makes recommendations to the operators and issues a timeline for implementation. Thereafter, the operators are required to provide specific commitments with tentative timelines in addressing the areas of identified non-conformity with the provisions of the pension laws.
“In this regard, the Compliance Officers of licensed operators, in line with the Commission’s regulation, are mandated to submit monthly status reports on the implementation of the commitments made during the annual routine examination.
“The monthly Compliance Reports are one of the monitoring tools instituted to monitor the level of compliance with the PRA 2014 and other identified lapses.”
Meanwhile, PenCom, yesterday, directed PFAs to implement the second edition of the pension enhancement exercise for retirees on the Programmed Withdrawal mode of retirement, under the Contributory Pension Scheme (CPS).
The Commission said the pension enhancement is for CPS retirees who have accumulated significant growth in their RSAs, and had retired between July 2007 and December 2017.
It, therefore, urged retirees under this category to contact their respective PFAs to confirm their eligibility and complete requisite documentation.
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