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PenCom seeks power to prosecute defaulting employers

By on October 21, 2013

The National Pension Commission is seeking legal power from the National Assembly to institute criminal proceedings against employers with at least five employees, who either refuse to register under the Contributory Pension Scheme or remit the monthly contributions of their workers into their Retirement Savings Account.

In a report which was obtained by our correspondent on Friday, the regulatory agency said it requires additional powers to institute criminal proceedings against employers for persistent refusal to remit pension contributions and effectively enforce the CPS.

PenCom said, “Section 11(7) should be amended to empower the commission to institute criminal proceedings, with fait of Attorney General of the Federation, against employers who persistently fail to deduct and/or remit pension contributions within the stipulated time.”

In the report, PenCom said it issued caution letters to 487 organisations for failure to comply with the provisions of the PRA, 2004.

Monetary penalties, it added, were imposed on some organisations, while it had been following up to ensure that the organisations comply with the PRA 2004.

PenCom said it made some recoveries of outstanding pension contributions and interest penalty from employers under the scheme.

According to the commission, after engagement and subsequent execution of the service level agreement with recovery agents, it has so far received progress reports from some agents on their recoveries.

The recovery agents were engaged to go after defaulting employers, and make them to remit workers monthly contributions that they had held unto with interest.

The latest statistics on compliance and enforcement activities, the commission showed that the regulatory agency had received 218 applications for the issuance of compliance certificate, out of which 175 were approved and issued.

Following the issuance of the certificates, a total of N3.1bn had been remitted by employers into 56,311 RSAs of their employees.

PenCom said employers whose requests were rejected were issued letters advising them on how to ensure full compliance.

While many employers have registered their workforce under the contributory pension scheme, not all of them are judiciously remitting the monthly deductions into workers’ Retirement Savings Account, PenCom said.

The Pension Reform Act 2004 mandates employers with at least five workers to register with the Contributory Pension Scheme.

Both the employer and employee must contribute 7.5 per cent each into the RSA of the employee with a Pension Fund Administrator monthly.

The Acting-Director General, PenCom, Mrs. Chinelo Anohu-Amazu, said 5.61 million contributors had been registered into the CPS since inception.

According to her, the commission had remained steadfast in the implementation of the CPS such that in few years of existence, some modest achievements had been realised.

Anohu-Amazu said the process of a major amendment to the PRA 2004 was at the final stages of consideration by the National Assembly.

The PenCom boss also said the commission embarked on the establishment of zonal offices in all the six geo-political zones of the country in a bid to decentralise its activities and bring it closer to contributors and retirees.

She said, “Due to our renewed focus on efficient service delivery, we seek to reduce the need for contributors and retirees to travel from various parts of the country to Abuja for the singular reason of accessing our services.”

Anohu-Amazu added that with the agency’s presence in the South-West zone, it expects all stakeholders to avail themselves of its services by visiting its office to make enquiries, lodge complaints, and seek enlightenment on the CPS.

 

 

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