Recession truncates PenCom 2016 15% projections

The much anticipated 15 per cent jump in the volume of funds accruing to the national pension commission (Pencom) this year may not be realistic after all, going by the impact of recession on the Nigerian workforce.

 

It was projected that by the end of the fourth quarer of 2016, Pencom will be expected to increase its fund assets by what it described as staggered patronage, estimated to have 25 per cent of employers and employees across all sectors of the economy, join the contributory pension scheme.

 

As at June 2016, Pencom was said to have had total assets of about N5.8 trillion and projected that the figure would rise to about N6.1 trillion by the end of 2016.

 

But this hope may have be hard to realize as the micro-pension scheme is said to be hit by the current recession, leading to workers in the informal sector declining willingness to embrace the plan.

 

According to most of them spoken to, companies are reducing workforce, who are supposed to link to the scheme.

 

Read also:  How airline operators are putting banking sector at risk —CBN

 

The umbrella body for the informal sector workers, the Federation of Informal Workers’ Organisations of Nigeria (FIWON) said interest of its members in the voluntary contributions bad been killed by many factors , including joblessness and high inflation rate among other things.

 

FIWON Secretary General, Comrade Gbenga Komolafe, said due to the generally low and irregular incomes of the informal sector workers and persons who are self-employed, the Micro Pension Plan, a part of the 2014 Pension Reforms Act, was introduced to ensure their financial security.

 

But PenCom officials said that all hope is not lost as the commission had embarked on awareness campaigns to sensitise players in the informal sector through their associations to the benefits of the scheme ahead of its commencement.

By Emma Eke….

 

 

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