Unpaid salaries: 109,284 workers retire without pensions.
Workers retiring without pensions due to non-payment of salaries and non-remittance of monthly deductions from their remunerations into their Retirement Savings Accounts by their employers have continued to increase under the Contributory Pension Scheme, NIKE POPOOLA reports
No fewer than 109,284 workers retired and quit the Contributory Pension Scheme as of the end of June, as they did not meet the requirements for monthly pensions.
Majority of the workers concerned were those who did not have up to N550, 000 in their RSAs as of the time of retirement.
According to the Pension Reform Act 2014, any worker with less than N550, 000 would be given the total balance in their RSA by the Pension Fund Administrator and allowed to leave the pension scheme.
Some of the affected retirees had so far withdrawn N27.09bn, as of the end of June, 2019, it was learnt.
It was also found out that some retirees who were offered low monthly stipends as a result of low funds in their RSAs rejected their offers, which they considered to be ridiculously low.
A retiree, Mary Moneme, who retired with less than N1.6m balance in her RSA said, “My PFA said if I collected 50 per cent lump sum, it would be paying me about N6,000 per month if I took the programmed withdrawal. The insurance company said it would be paying me about N7,000 with the annuity.
“The PFA said if I took 25 per cent lump sum, it would be paying me about N9, 000 while the insurance company said it would pay about N10, 000.
“What will I be using that kind of monthly stipend to do? I have left my PFA and have not returned there because that monthly stipend is not a living wage.”
According to industry stakeholders, irregular payment of salaries by employers at the state and private sectors made the workers to have no pension savings because the savings could only be deducted from a paid salary.
Some employers who had also continued to deduct their workers monthly salaries but refused to remit such to the RSAs with the respective PFAs had also denied the workers the ability to earn pensions.
He said that the insurance operators, who were administering the annuity, had also been in talks with the commission on whether or not the annuitants would be brought into the net when the minimum pension commenced.