NEWS ANALYSIS: Why Senate Should Quickly Confirm Buhari’s Nominees For PenCom

After nearly three years of waiting, the Senate on Tuesday finally received a formal request from President Muhammadu Buhari for the confirmation of six nominees appointed as Chairman, Director General and Commissioners of the National Pensions Commission (PenCom).

The nominees are:  Dr .Onyidasola Oluremi Oni( Chairman, representing North Central), Aisha Dahiru -Umar ( Director General, representing North East), Clement Oyedeola Akintola (Commissioner, representing  South West), Anyim Nyerere (Commissioner, representing South East), Charles Emukwohate ( Commissioner, representing South South) and Hannatu Musa( Commissioner representing South West).

The request for confirmation of a new Executive Management for PenCom must come as a relief to the pension industry which has continued to weather the storm of challenges and is now on the verge of new reforms. It is also commendable that President Buhari picked technocrats and professionals with integrity as nominees for the PenCom positions. This would no doubt engender more confidence in the industry regulator by stakeholders.  

Aisha Dahiru-Umar, who was appointed as Acting Director General in April 2017 and is now to be confirmed substantive DG, has significantly strengthened PenCom’s regulatory role through painstaking efforts to institutionalize transparency, accountability and integrity in the pension industry.

Since taking the helms at PenCom, she has widened the base of the Contributory Pension Scheme and expanded the RSA registration to 9, 039, 748 as of June 2020. PenCom under her has also increased pension assets by over three trillion naira to N11.08 as of June 2020.

Not only has the Commission ensured prompt release of funds to reduce the hardship faced by pension beneficiaries, it had also prioritized payments of death benefits to families of deceased employees.

 But with gradual decline of income from oil, the Federal Government, which pays huge funds in retirement benefits of employees, had found it more and more difficult to meet its pension obligations. In the last five years, especially, budgetary releases had not been regular and adequate for the payment of outstanding accrued pension rights.

  There are also challenges of compliance to regulations by private sector employers and sharp practices by some Pension Fund Administrators.

In a country with an estimated population of over 200 million, pension should be a huge industry providing thousands of jobs and boosting the capital market.

But coverage has also been one of the major challenges facing the Contributory Pension Scheme as only a meager 8.1 percent of the country’s working populations have been captured.

Efforts are still needed to expand the scheme and grow the industry to the height it is capable of reaching. That is why the current attempt to review the Pension Reform Act 2014 is a welcome development.

PenCom, working with stakeholders, has embarked on a process of reviewing the PRA 2014 in order to seek new ways to address implementation challenges and introduce improvements to the CPS.

This is why the news of the proposed senate confirmation of the new Executive Management for PenCom is timely. The senate, and indeed the National Assembly, should also ensure that new legislative interventions to improve pension administration are initiated.