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PenCom recovers N7.74bn from defaulting employers

By on February 15, 2016

The National Pension Commission has recovered a total of N7.74bn from employers that have deducted pension funds from their employees but failed to remit the money to the workers’ Retirement Savings Accounts being managed by different Pension Fund Administrators.

This was contained in the latest report obtained by SUNDAY PUNCH from PenCom on Friday, showing the figure was for the second quarter of 2015.

The Director-General of the commission, Mrs. Chinelo Anohu-Amazu, who described non-remittance of pension funds by employers as a crime, had said that PenCom would seek the support of law enforcement agencies to enforce the remittance of the funds.

According to her, there are 6.637 million account holders in the Contributory Pension Scheme.

The report stated, “During the second quarter of last year, the sum of about N1.007bn, representing principal contributions of N435.78m and penalty N571.86m, was recovered. This brings the total recoveries made to date to N 7.74 billion.”

It was learnt that the affected firms started remitting their outstanding pension funds with penalty charges to PenCom early in the year (2015), following the issuance of demand notices to defaulting employers, whose liabilities had been established by the commission’s consultants.

The commission said it maintained the services of consultants to follow up and recover the deducted pension funds with penalty charges from defaulting employers.

It said the commission had continued to apply various strategies to ensure compliance with the provisions of the Pension Reform Act 2014, which included the five applications of sanctions and collaboration with key stakeholders on public enlightenment campaigns.

“Similarly, the agents employed by the commission have continued to recover outstanding pension contributions with interest penalties from all errant eligible employers,” it stated.

It also said that during the second quarter of last year, the commission received 1,268 applications for the issuance of compliance certificates.

Out of these applications, it said compliance certificates were issued to 929 organisations while applications from 339 were turned down due to non-remittance of pension contributions for the appropriate period and non-provision of group life insurance policy for their employees.

Anohu-Amazu had pledged that the informal sector would be made to join the scheme, with only 11 per cent of the working population currently captured by the scheme.

“The PenCom reform has introduced the Pension Contributory Scheme. The scorecard remains that we have 6.637million retirement savings account holders today. What that has done is to show us the opportunity for more people to get in because it is only about 11 per cent of the working population (that are in the scheme),” she said.

She met with President Muhammadu Buhari last year on the issue and other challenges facing the scheme.

The President was reported to have directed the commission to work with Vice-President Yemi Osinbajo to ensure that all states join the scheme.
[Punch]