Contributory pension assets increase by 340 billion naira, reaching 13.76 billion naira

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Total assets under the contributory pension scheme gained 340 billion naira in two months and rose to 13.76 billion naira at the end of February.

This was included in the National Pensions Commission’s latest report, titled “Unaudited Report on the Pension Fund Industry Portfolio for the period ended 28 February 2022; Approved existing schemes, administrators of closed pension funds and RSA funds (including unpaid contributions @CBN and legacy funds).

The report was obtained by our correspondent on Friday.

The funds, which ended on December 31, 2021 at 13.42 billion naira, increased to 13.61 billion naira at the end of January 2022.

The data showed that N8.51tn of total funds were invested in federal government securities, comprising bonds and treasury bills, in February.

Other investment portfolios in which funds have been invested include domestic and foreign common stocks; corporate debt securities including corporate bonds, corporate infrastructure bonds, corporate green bonds and supranational bonds.

PenCom also revealed that the total number of workers with retirement savings accounts increased slightly to 9,589,721 at the end of February, from 9,529,127 at the end of December 2021.

The Pension Reform Act, which led to the CPS, was inaugurated in 2004.

It provides for a contributory system in which the employer and the employee contribute to the RSA for employees.

In addition, the Association of Pension Fund Operators of Nigeria said the CPS helps Nigerian workers save for retirement and provide funds for infrastructure development.

Operators have urged workers to increase their statutory deductions, noting this will allow them to increase their overall savings balances over time.

In a statement, the association said: “It is also pertinent to note that the contributory pension scheme in its current state has largely fostered a culture of savings in Nigeria. Prior to the enactment of the law, Nigeria did not have large domestic savings reserves.

“Many Nigerians have no other form of savings except through this contributory pension scheme. What we should be doing as a nation is to encourage these economies more rather than seek to dismantle the system.

“It is probably the only form of savings that most Nigerian workers are able to set aside for their retirement years.”

PenOp also advocated consistency and discipline in contributions, adding that this would eliminate the need for any large lump sum payments in retirement.

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