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Published On: Thu, Mar 6th, 2014

No staff is involved in looting pension fund–PenCom

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From Ngozi Onyeakusi, Lagos

The National Pension Commission (PenCom), has cleied that one of its staff was arrested by the Independent Corrupt Practices and Other Related Offences Commission (ICPC) for possessing fifty bank accounts.

The commission made the clarification following some media publications stating that ICPC has arrested a junior PenCom staff with fifty bank accounts.

A statement from the commission signed by the Head of Communications, Mr Emeka Onuora stated that the write-ups appeared in some national newspapers with various headlines giving the impression that there was looting in PenCom.

The stories, it said quoted the ICPC Chairman, Mr. Ekpo Nta, as saying that there were serious cases of fraud running into billions perpetrated by junior officials in the Pension Commission but that only top officials were given attention in the chase for corrupt officers.

The Commission wishes to state categorically that no staff of PenCom is involved in any form of looting of pension fund.

The Contributory Pension Scheme (CPS) was created by the Pension Reform Act of 2004.

The reform came into being when it became obvious that the Pay As You Go pension system could no longer fulfil the expectations of retirees in the country as it was fraught with irregularities and fraud that

led to non-payment of benefits to pensioners who had hitherto servedthe nation meritoriously.

The CPS is based on individual Retirement Savings Accounts that is managed by Pension Fund Administrators (PFAs) and supervised by the National Pension Commission. Its funding is on monthly deductions from employees’ salaries and the equivalent contribution by the employer. The pension fund assets are held by Pension Fund Custodians (PFCs) licensed by PenCom.

The CPS is predicated upon structures that have adequate in-built control mechanism to prevent fraud. There are safeguards to protect the pension funds from all forms of misappropriation with the

functions of custody and administration of the funds clearly delineated. While the PFCs are in custody of the pension funds, the PFAs manage and administer the funds. Furthermore, the PFAs and PFCs are mandated by the Commission to maintain high levels of transparency and accountability, such that enable individual RSA holders to have full access to any information relating to their pension

contributions.

It is pertinent to note that there are enough checks and balances for contributors’ fund under the CPS which PenCom directly supervises.

The Commission is constrained to clarify the issues in order to set the records straight as well as educate and assure contributors and the general public of the robust legal and institutional frameworks established to ensure the safety of pension assets under the Contributory Pension Scheme.

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