Overview:
PenCom, Nigeria’s apex regulatory authority for the pension industry, marked a transformative year in 2023. Demonstrating an unwavering commitment to effective oversight and innovation, PenCom implemented several initiatives that shaped the nation’s pension landscape positively. This summary highlights the major triumphs and initiatives undertaken by PenCom throughout the year.
- Growth of Pension Fund Assets and CPS Membership:
PenCom witnessed significant growth in Pension Fund Assets during the first ten months of 2023, with assets increasing by N2.67 trillion from N14.99 trillion in December 2022 to N17.66 trillion by October 2023. Concurrently, the Contributory Pension Scheme (CPS) membership grew by 278,800 new Retirement Savings Accounts (RSAs), reaching 10.14 million from 9.86 million in December 2022.
- Third Edition of the Pension Enhancement Exercise:
The Pension Enhancement Exercise, a periodic enhancement of pensions for CPS retirees, saw its third edition between February and July 2023. A total of 111,187 retirees under programmed withdrawal mode benefited from the enhancement, a significant improvement over previous editions in 2017 and 2020.
- Additional Benefits Schemes under CPS:
PenCom introduced the Framework for the Establishment of Additional Benefits Schemes under the CPS. This initiative allows employers to provide additional benefits, such as gratuity, to employees upon retirement, aligning with Section 4(4)(a) of the Pension Reform Act (PRA) 2014.
- Accessing RSA for Residential Mortgage:
The Guidelines on Accessing Retirement Savings Account (RSA) Balance for Residential Mortgage Equity Contributions continued to be implemented. In 2023, 1,737 pension contributors accessed N18.601 billion from their RSA balances towards payment of equity contributions for residential mortgages.
- Online Enrolment/Registration:
The 2023 online Verification and Enrolment Exercise for treasury-funded Ministries, Departments, and Agencies (MDAs) retirees and prospective retirees commenced on October 2, 2023. Two options, Self-Assisted and Pension Desk Officer (PDO)/PFA-Assisted, were provided for registration to simplify the process.
- Pension Clearance Certificates:
PenCom issued 30,293 Pension Clearance Certificates (PCCs) to private organizations that applied and fully complied with the requirements, serving as evidence of compliance with the Pension Reform Act 2014.
- Uncredited Pension Contributions:
To address uncredited pension contributions due to incomplete documentation, PenCom posted lists of affected employers and employees on their websites. A press release on September 6, 2023, directed employers and employees on the list to provide necessary information for crediting contributions into RSAs by the end of December 2023.
- The Commission’s Corporate Strategy:
PenCom developed and implemented a refreshed Corporate Strategy, introducing innovations focused on improved service delivery to stakeholders. A Consumer Protection Department was created to ensure effective and efficient service to pension contributors and retirees.
- Commendations:
PenCom received commendations from critical stakeholders, including labour unions, pensioners’ unions, employers’ associations, and the business community. During the 2023 Annual Directors Conference, Mr. Olusegun Aganga (CON), Managing Director of Goldman Sachs, commended PenCom for its effective regulation of the pension industry, stating that it is now one of the best-regulated sectors in Nigeria.
In summary, PenCom’s achievements in 2023 underscore its commitment to effective regulation, innovation, and ensuring timely retirement benefits for pension contributors and retirees in Nigeria.
