It’s Against The Constitution To Enforce Implementation Of CPS On States – PenCom

The 1999 Constitution of the Federal Republic of Nigeria (as amended), in Section 210, states that a person’s right to receive pension or gratuity in the public service of a state can only be regulated by law.

Based on this constitutional provision, the National Pension Commission (PenCom) says it will be contravening the Constitution if it decides to enforce the implementation of the Contributory Pension Scheme(CPS) on states  under the Pension Reform Act (PRA) 2014.

The CPS was established under the Pension Reform Act 2014 to replace the Defined Benefits Scheme (DBS).

The acting Director General of the PenCom, Aisha Umar-Dahir disclosed this in an interview with Daily Trust in Abuja.

Recall that the commission in a document titled “Status of Implementation of the Contributory Pension Scheme (CPS) by States and the FCT as at March 2019” revealed that several states in the country are still dragging foot on the full implementation the CPS while many are still at the level of domesticating the legal framework.

Domestication of the CPS at the sub-national level in Nigeria was one of the focus while enacting the PRA 2014. But reviewing these, the commission lamented that only 27 states have enacted laws on the CPS while one has decided to continue with the Defined Benefit Scheme (DBS).

However, Umar-Dahir said there is nothing much the commission can do but create more awareness as the commission has no right to compel states to implement the CPS but rather promote and offer technical assistance to States in line with the objectives of the scheme.

“There is a positive correlation between performance of states under the Defined Benefits Scheme and the adoption of the CPS by states.

“Most states that were doing well in the payment of retirement benefits under the Defined Benefits Scheme were more favourably disposed to adopting the CPS and are doing better in its implementation than those who were not.”

Meanwhile, as a result of the constitutional limitations on PenCom, the commission has continuously created awareness to persuade states to embark on the full implementation of the scheme.