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PenCom recovers N6.7bn from defaulting employers

By on August 12, 2015

The National Pension Commission has recovered N6.7bn from employers who have been deducting pension contributions from their workers’ monthly salary but not remitting the same to the employees’ Retirement Savings Accounts.

A report obtained by our correspondent on Monday indicated that the amount was recovered as of March this year. It also showed that PenCom fined the errant employers N395.09m.

“During the first quarter of this year, the sum of N540.94m, representing principal contributions of N145.85m and penalty of N395.09m was recovered. This brought the total recoveries made to date to N6.73bn,” it noted.

PenCom said that during the first quarter of this year, it received 1,050 applications for issuance of compliance certificates, out of which 840 employers were issued the certificates while the remaining applications were rejected on the grounds that they did not meet the requirements.

The commission recruited the services of the recovery agents to go after employers found to be notorious for not remitting the monthly deductions from their workers to their respective Pension Fund Administrators as and when due.

PenCom said it had retained the services of consultants to conclude the work on the recovery of outstanding pension contributions from other defaulting employers.

The commission said it resorted to the use of force and penalties, having exhausted various persuasive methods of making the defaulting firms to comply.

Some of the approaches adopted, according to PenCom, are public enlightenment, media campaign and collaboration with regulatory and professional bodies.

Others are engagement of consultants, disclosure requirement and issuance of compliance letters, financial literacy and enforcement.

It said the regulation and supervision of the pension industry had continued to focus on risk-based examination of licensed pension operators with a view to promoting transparency and providing early warning signals as well as encouraging pension operators to regularly self-evaluate their positions.

The Director-General, PenCom, Mrs. Chinelo Anohu Amozu, said the commission scaled up its compliance and enforcement strategies in order to enhance the compliance with the provisions of the Pension Reform Act 2014.

“Consequently, sanctions were applied on some operators in line with the compliance framework. In addition, the commission has participated in public enlightenment programmes as well as collaborated with various stakeholders to enhance compliance,” she said.

She said the commission also developed the guidelines for the informal sector’s participation in the Contributory Pension Scheme and sent to all stakeholders for comments.

The inputs from various stakeholders, she added, had been collated and would be incorporated into the framework.

Anohu-Amazu said the commission had commenced work on the guidelines and other modalities that would facilitate the participation of the informal sector in the scheme.

She said as part of the strategies to increase the level of compliance and awareness of the scheme, the commission had facilitated and participated in a two-day sensitisation workshop on the CPS for key stakeholders in Minna, Niger State.

“The participants were drawn from the Ministries, Departments and Agencies of Niger State and its local governments as well as the state pension board,” Anohu-Amazu said.