The Senate on Tuesday took steps to channel the N2.9 trillion pension fund into investments to generate tangible benefits for the contributors and the nation.
This followed the second reading of the Bill for an Act to Repeal the Pension Reform Act of 2004 and enact the Pension Reform Act of 2013 at the floor of the Senate.
The Senate Leader, Senator Victor Ndom-Egba, in his lead debate, said apart from securing the future of retirees, the fund was also meant to boost the economy by improving the financial market.
Ndoma-Egba said the N2.9 trillion accumulated pension funds would be used for financing infrastructure development projects, job creation and other profitable national ventures.
He said the bill provides for the establishment of a pension protection fund to pool resources for funding minimum guaranteed pensions.
Ndoma-Egba said: “This bill will strengthen the pension commission to administer, regulate, supervise and re-enforce the current pension reforms.
“As at September 2012, the estimated accumulated pension funds stood at about N2.9 trillion.
“One can imagine the impact of such funds in the economy if channelled properly.”
He said the proposed law would improve payment of retirement benefits, timely remittance of pension and correct the defects in the extant law.
Senator Solomon Ewuga (CPC-Nasarawa State) advised that all loopholes noticed in the existing law should be blocked to check abuses by fraudulent persons.
EWuga said the reform would guarantee professionalism and bring the pension management in conformity with international best practices.
Senator Barnabas Gemade (PDP-Benue) suggested that the investment portfolio should be expanded to cater for infrastructure development.
“The bill must incorporate in it a new investment portfolio so that the pension funds can be used to close the infrastructural gap in the country,” Gemade said.
Senator Babafemi Ojudu (ACN-Ekiti) said it was sad that the pension funds as currently managed were not used for investments that would yield good financial benefits for the contributors.
Ojudu said: “The pension fund could be best used to develop contributor affordable mass housing projects for the teeming low income earners in the country.
“The funds should be invested in sectors that impact directly on the population, such as transportation, power and roads to make life meaningful for Nigerians.”
Senator Ahmed Lawan (ANPP-Yobe) said experienced hands should be appointed to manage the funds to address the challenges of mismanagement being experienced in the pension sector.
“Lawan said: “We must not allow inexperienced persons to manage the pension funds.
“We should not bring down the required 20 years of experience to 15.”
In his ruling, the Senate President, Senator David Mark, decried the appointment of unqualified persons to manage pension funds, saying that only specialists should be appointed.
Mark said: “The problem is that all sorts of rookies and people who have no idea about managing funds, not to talk of very huge pension fund, go to manage our pension fund.
“The national budget is N4.9 trillion and we have money in the pension fund up to N2.9 trillion.
“So you can imagine the amount of money at the disposal of few individuals, who are not properly trained or supervised.”
Mark decried the untold suffering of pensioners on account of the non-payment of their pension after retirement from active service.
He said all necessary measures must be put in place to ensure workers who contributed received their pensions after retirement on time.
He said: “This money could be usefully invested or channelled to better use so that the nation can benefit.
“We cry of lack of infrastructure all the time while there is so much funds sitting down there idle for people to embezzle.
“We should look for people who are very experienced in the management of pension. I don’t understand the rationale for reducing the experience of the DG from 20 to 15 years.
“For me, it doesn’t make sense at all.”
The bill was referred to the Committee on Establishments for further legislative work and to report back in four weeks.
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