States’ Uncredited Pension Remittances Hit N4.7bn

Pensioners across Nigeria are facing significant delays in their payments as uncredited remittances from state governments have reached N4.7 billion.

The National Pension Commission (PenCom) clarified that while states have made the necessary remittances, issues such as incomplete information and lack of proper documentation have prevented these funds from being credited to the Retirement Savings Accounts (RSAs) of pensioners.

The amount of uncredited pension remittances from 25 States and the Federal Capital Territory (FCT):who subscribed to the Contributory Pension Scheme (CPS) and the Pension Fund Administrators (PFAs) rose to N4.7 billion as at the end of June 2024, LEADERSHIP learnt.

The remittances has been paid by the respective state governments but with the States and Local Pension Bureaux and the pension fund operators who are struggling to credit the Retirement Savings Account (RSA) of the supposed beneficiaries as a result of lack of proper identification and documentation, no Schedules, PIN, among other issues, LEADERSHIP investigation revealed.

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The Pension Reform Act 2014 (PRA 2014) mandates employers with three or more employees to remit pension contributions into the RSAs of their employees with Pension Fund Administrators (PFAs). So, when such did not reflect in the RSAs of contributors as a result of identity issues or no schedules from States even when allocation and disbursements have been made by concerned state governments, it is known as ‘Uncredited Remittances.’ The fund is there but with no properly identified beneficiary attached.

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The N4.7 billion was accumulated as a result of no schedule from State pension commissions or bureaux as well as Personal Information Number (PIN), among other issues between October 2019 and June 2024.

A document sourced by LEADERSHIP from the National Pension Commission(PenCom) shows that, while the total contributions uncredited due to no PIN and other issues,  amounted to N3.1 billion, total contributions uncredited due to no schedule was N1.6 billion, making a cumulative N4.7 billion.

Of the 26 States including the Federal Capital Territory(FCT) having N3.1 billion uncredited remittances as a result of PIN and other issues,  Kaduna State led with N1 billion, followed by Delta State with N597.6 million and Abia State came third with N589.1million. Cross River State has the least with N5,894.

Similarly, of N1.6 billion uncredited remittances residing in Pension Fund Administrators(PFAs) with no schedule, Stanbic IBTC Pension has the highest with N524.1million, followed by FCMB Pension with N228.2 million  while PAL Pension came third with N210.8 million.

The continuous rise in uncredited pension remittances is a cause of concern for pension stakeholders who were calling for a quick fix to ensure that the affected  contributors were not denied their full benefits at retirement.

Speaking on this development at a forum in Lagos at the weekend, the head, States Operations Department, PenCom,  Carol Alex-Uzomah, stated that the total contributions uncredited due to no PIN and other issues, rose from N1.42 billion in October 2019 to N3.1 billion as at the end of June 2024 and remittances without schedules increased from N615.5 million in October 2019 to N1.6 billion in June 2024.

To this end, she charged states and local government Pension Bureaux to carry out reconciliation of remittances within the bureaux to address the growing uncredited remittances.

“It is not that states are not remitting but they are making remittances without schedules. Hence, States and Local government bureaux should stop sending incomplete schedules or even without schedules as this is growing uncredited remittances. Moreover, Pension Fund Administrators(PFAs) should follow up on the bureaux where they noticed schedules were not forthcoming or the ones sent were incomplete,” she pointed out.

She promised that PenCom is more than ready to mediate and address this scourge, hence, will use the platform created by the Quarterly Consultative Forum for States and FCT, which was suspended in 2019 due to Covid-19 then, but has now been revived this quarter, to address some of the challenges with CPS implementation at the States level in the country.