The Effectiveness Of Pension Administration In Nigeria As It Relates To Pension Reform Act, 2004

Filed in Banking and Finance Project Topics by on October 27, 2020

The Effectiveness Of Pension Administration In Nigeria As It Relates To Pension Reform Act, 2004.

ABSTRACT

Pension Administration in Nigeria in the recent past has been very challenging. The present experience has shown the administration could be relied upon given that is has undergone a lot of reforms poised to make a difference from past experiences. The present pen com Reform Act, 2004 is fashioned after the model in Chile.

It is fully funded  at all times; hence, there are no funding gaps. Where there seems to exist one, provision is made for correction within 90 days under pencom supervision. Safety valves are installed. This is why the administration of pension assets is separated from  custody. Furthermore, pension assets are not used as collateral.

There is the  need by pencom to closely monitor the activities of Pension Fund Administrators to curtail signs of distress as experience in Latin America has shown that in Chile. Where the model is copied from, the nation commenced contributory Pension scheme with 12 pfas, graduated to  21 and presently only 6 pfas are on ground either through mergers or acquisition.

However, this does not suggest that the pension assets of contributors have gone underground. This is made possible as  a result of the safety valves inbuilt into the system as the administration function of the pfas is separated from custody function of the Custodians. The research method adopted was by the use of both  primary  and secondary data.

The primary sources comprised  structured questionnaire and oral interviews administered on the respondents. The secondary data derived from textbooks, publications, newsletters and relevant websites. The research method adopted was by  the  use  of both primary and secondary data.

INTRODUCTION

Before their former colonies gained independence,  the colonial powers in Africa (France, Britain, Spain and Portugal) introduced different models of social security systems to their respective colonies primarily as an extension of their own systems and essentially for the benefit of their respective expatriates working in the public sector in  Africa.

Later on, the same or different benefits were extended to African workers in the civil service, the industrial sector, and urban cities initially as an incentive for a steady labor force and later as a way of satisfying the demands of labor unions. Unfortunately, the rest of the population was excluded.

Former North Africa colonies with close proximity to Europe (Algeria, Egypt, Libya, Morocco, and Tunisia had employment-based pension schemes in places as early as the 1950s and subsequently, Algeria, Egypt, and Tunisia expanded their benefits to include unemployment benefits and extended leverage to the self-employed.

However, former British colonies (such as Ghana, Nigeria, Kenya and Swaziland) initially focused more on providing benefits for work-related injuries through a worker’s compensation system.

REFERENCES

Adetola adegbayi, “pension industry development in nigeria – the trust of the pension reform act 2004”

Bisi onasanya (november, 2006), a paper presented on “pension reform and role of financial market”

Dian vujovich (1995), “ straight talk about investing for your retirement”

Economic confidential website

Femi o. Odulana(2007), “pension reforms in nigeria”

Frequently asked questions and their answers on the contributory pension scheme in nigeria, first edition august, 2005.

CSN Team.

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