A recent report states that the Pension Fund Administrators have raked in a profit of N7.98 trillion from the investments made by employees into their Retirement Savings Accounts under the Contributory Pension Scheme.
According to The Punch, a report from the Pension Fund Operators Association of Nigeria revealed that as of the end of the second quarter of 2023, the total funds under the CPS stood at 17.37 trillion.
The total amount of contributions made during the reviewed period by employees in the public and private sectors was N9.37 trillion.
According to a report released by PenOp’s Chief Executive Officer, Mr. Oguche Agudah, titled “At the dawn of 20 years of pension reform, what are the gains?”, employee contributions accounted for 54%, while the return on investment accounted for 46 percent of the entire pension funds as of the end of June 2023 from the beginning of the CPS in 2004.
The pension operators revealed that in order to lessen the impact of inflation on the funds, worker contributions were carefully invested, and the returns were added to the workers’ pension savings.
Additional data revealed that by the end of 2023’s third quarter, the PFAs had collected N24.8 billion from employers who had fallen behind on their payments.
In Q2, 2023, N665.13bn was paid as a lump sum to annuity retirees and N964.24bn to retirees on programed withdrawal, for a total of N1.64tn to 442,000 retirees, according to the report from PenOp.
It further stated that 475,235 workers who lost their jobs before reaching official retirement age and were unable to find new employment after four months received N208.86 billion in compensation.
In the second quarter of 2023, 91,214 beneficiaries received death benefits totaling N356.32 billion.
According to the report, 649 contributors received permission from their RSAs to use N7.89 billion for home mortgages.
Agudah stated that it expected to commemorate the 20th anniversary of the Pension Reform Act, put more emphasis on micro pensions, and investigate the revision of investment guidelines, all while outlining the expectations of the operators for 2024 and beyond.
The operators, he continued, anticipated receiving more applications and approvals for the RSA mortgage, the potential start of offshore investment, and the formation of an infrastructure consortium.
According to the report, the PRA was created as an Act to provide CPS for employers in the nation’s public, Federal Capital Territory, and private sectors.
It also stated that the number of contributors under the CPS increased from 2,543,178 to 10,023,314 between July 2023 and 2007.
