The Director General of the National Pension Commission (PenCom), Aisha Dahir-Umar, has refuted claims that the Commission provided a N10 trillion loan to the Nigerian government, calling such reports “completely misleading.”
Dahir-Umar addressed allegations that PenCom owed arrears of pensions to Federal Government retirees and clarified misconceptions about Pension Fund Administrators (PFAs) not fulfilling their obligations to retirees regarding access to their retirement savings.
She explained that PenCom is not a financial institution that manages pension funds, and the Federal Government did not borrow N10 trillion from the Commission.
According to her, investments made by PFAs in Federal Government securities are not loans but rather investments in approved securities like bonds and treasury bills, overseen by agencies such as the Debt Management Office (DMO) and Securities and Exchange Commission (SEC).
Dahir-Umar said pension fund assets are not held by PenCom but by licensed PFAs and Pension Fund Custodians (PFCs).
“The PFAs are responsible for investing pension assets in allowable asset classes, including FGN debt instruments, with the aim of ensuring safety and fair returns in accordance with the Pension Reform Act 2014.”
She noted that investing in FGN securities is a common practice among institutional investors globally, as these securities offer safety and fair returns.
“The FGN has consistently met its repayment obligations to all investors, including pension funds, for investments in bonds and treasury bills.”
Regarding outstanding benefits for Federal Government retirees, Dahir-Umar explained that delays in payment are due to inadequate and delayed funding for Accrued Pension Rights of those who were in service before the introduction of the Contributory Pension Scheme (CPS) in 2004.
According to her, the release of funds for these payments is dependent on the Federal Government’s budgetary constraints, beyond the control of PenCom.
She assured that all individuals enrolled under the CPS have been receiving their benefits through their PFAs, with no unresolved complaints before the Commission.
Dahir-Umar reiterated PenCom’s commitment to engaging with the Federal Ministry of Finance to secure more funds for settling these liabilities.
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