PenCom Says N2.18 Billion Withdrawn Under CPS In Q3

Yemisi Izuora

The National Pension Commission, PenCom, has disclosed that 1,286 employees withdrew estimated amount of N2.18 billion in the third quarter of 2020 by under the Contribution Pension Scheme (CPS).

According to PenCom, the amount was taken by the workers from the voluntary contributions in their Retirement Savings Accounts (RSAs) with their Pension Fund Administrators (PFAs).

In its 2020 third quarter report, PenCom stated that, “During the quarter under review, the commission granted approval for withdrawal of the sum of N2.18 billion from the voluntary contribution accounts of 1,286 contributors.”

The guidelines on voluntary contribution under the CPS states that, “The Pension Reform Act 2014 allows employees to make, voluntary contributions into their Retirement Savings Account, in addition to their mandatory pension contributions, with the sole aim of enhancing their retirement benefits.

“Voluntary contributions under these guidelines shall be non-obligatory contributions made by any employee in the formal sector through the employer.

“Employees of organisations with less than three employees as well as self-employed persons as provided in Section 2 (3) of Pension Reform Act 2014 (PRA 2014) shall be covered under the guidelines for micro pensions.”

Any eligible contributor under these guidelines must inform his employer in writing of his reasons to make voluntary contributions and the amount be deducted from his emoluments and remitted as voluntary contributions, according to the commission.

It also mentioned that voluntary contributions should be made from employee’s legitimate income, which should not be more than a third of the month’s salary in line with the Labour Act, 1990.

All voluntary contributions must be remitted through an employer into the RSA, it stated.

According to PenCom, the objectives of the guidelines are to establish a uniform set of rules for the operation of voluntary contributions and eligibility criteria for participation in voluntary contributions.

It also provided the procedure for making voluntary contributions, and necessary safeguards and modalities for its withdrawals.

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