6.9m Nigerians contribute N5.3trn to Pension Fund Scheme

After 10 years the contributory pension scheme kicked off in Nigeria, it has emerged that approximately 6.9 million out of about 170 million Nigerians have keyed into the scheme resulting in N5.3 trillion contribution within the period.

Making this disclosure at the 2016 Workers’ Day celebration at Onikan Stadium in Lagos, Susan Oranye, executive secretary of Pension Fund Operators Association of Nigeria (PenOp), said contrary to the N20 trillion being touted as the total contribution, the actual contribution from 6.9 million employees across the country stood at N5.3 trillion.

According to Oranye, there has been marginal growth since May 1 last year, and there is still a lot to be done by encouraging Nigerians to see the benefit of pension at retirement.

“As at first quarter of the year, the total fund was N5.3 trillion. Since May last year till now the industry has grown and that is an indication that workers are paying pension in preparation for their retirements. People understand the importance of a pension that is why they are joining the contributory pension.

“There is a lot of work to be done because we have 6.9 million people as contributors. This is a drop in the ocean when you consider the population of the country, though we have progressed but we are aware that there is still work to be done, if we need to reach N60 trillion mark,” Oranye said.

Speaking on the dignity of labour, the PenOp boss said, “There is dignity in labour, Nigerian workers deserve to still have their financial dignity in retirement also. Something can be said for the independence you enjoy when you have a steady pensions coming in to help maintain a decent standard of living for your loved ones when you retire.”

While highlighting the effect of the current economic situation on the scheme, she said, “It can only get better. The Nigerian economy is going through a bad parch. But they usually say after the nightfall, the sun comes out. So, the growth may not be as good as we may have wanted because of the current economic situation with retrenchments and businesses going out.”

She however said it was important to believe it would get better and once it got better the industry would blossom much more than it was growing. Once things are put in place as the government has said, the economy will grow in leaps and bounds, hence the effect on businesses within the economy, she noted.

“This will have an effect on employment, and as long as the businesses within the economy thrive and people are working everyday there will be important of pension,” she said.

Incidentally, the industry has already set agenda to grow the contributory base to approximately 20 million by 2025. Oranye, who owes this to improved employment in the country, said the industry was buoyed for a double figure in contributory base in the next two years.

“The industry strategic direction is the 10 years primary focus. In 2025, we will be hoping to raise the number of contributors to 20 million. We can say by 2017 or 2018 we would have doubled the figure. We are optimistic and for that to happen the employment rate really need to settle,” she said.