Henry Uche
The fear of retirement is one silent killer that many active Nigerian workers are battling with their subconscious mind. The consequences of this syndrome are graver and have multiplier effects on the economy than the government’s campaigns on corruption.
Of course, the unending plight of pensioners is what has aggravated the instincts for sharp practices across all government establishments. The apprehensiveness, among other things, breeds dishonesty, stealing, avarice and cheating on government’s time and other resources. The case of the 30-year-old driver, Duke Harry, in a government parastatal at one of the state secretariats readily comes to mind.
Harry was employed at Level 05 when he was at the age of 24. By the time he was 30 years, he was still expecting his first promotion to Level 06, but contrary to expectations and calculations, Harry has amassed so much wealth that he brags to his ‘not-so-fortunate friends’ that he is ready for retirement anytime. Everyone around him often wondered why he was always so lousy and brazen. Soon, the story broke that Harry was a member of a money-sharing racketeer group in the parastatal where he was. The team he worked with before his present position was headed by a Level 15 officer, an assistant director, who did not look down on Harry as a driver but included him in the sharing of loots. What was the loot about? The racketeers were members of a 10-man committee assigned by the government to oversee the disbursement of long-held allowances of medical doctors in the state. The money involved ran into billions of naira, which were legitimate allowances owed to medical doctors for over five years.
The leader of the disbursing committee, an assistant director, had ensured that every member of the committee made millions of selfish gains before completing the assignment. Harry was not left behind because of his uncanny and duplicitous loyalty to his boss. This was how Harry ran into his ill-gotten wealth that made him bold and insolent as a junior civil servant.
Cases like Harry’s story are numerous across government establishments and even private sector where workers manipulate government’s/management’s plans, policies and programmes in the name of what they describe as “saving for the rainy days’. But who will you blame?
The chronicles of pensioners’ agonies date back to the 1950s. The issue of pension administration has been a conundrum and incubus to many government regimes; it is so critical that if handled tactlessly, it often gives rise to public brouhaha and criticism on the side of government.
In Nigeria, pension administration is characterised by multiple and complex problems at all levels of government. Nigeria received a pension administration that is entirely bizarre and modelled after the British structure. The pitfalls of this structure led to many inglorious actions and inactions, which gave birth to the 2004 Pension Reform Act (PRA). This reform also was plagued with myriads of flaws; for instance, some workers at the state and local government levels were ostracised; most state governors were unable to key into the scheme and the reform suffered implementation problem which is a major challenge in public administration. Hence, agitations for another amendment.
To stem this tide, Nigeria’s National Assembly passed the amendment bill, which was assented to by the former president, Dr Goodluck Jonathan, on July 1, 2014. This act seeks, among other things, to painstakingly examine the lapses, irregularities and other flaws in the old act and to suggest better ways to improve the scheme. All efforts were geared towards bettering the lot of these weak and frail-looking ‘senior citizens’.
With the enactment of the new scheme, a transparent, prudent and responsible pension administration is expected to restore the trust and confidence of pensioners and the entire labour force on their pension administrators.
Industry watchers have observed with dazed bewilderment that the Nigerian government is known for “administrative negligence, poor planning system, poor policy implementation, poor social security system, poor sustainability plans and other management pitfalls in pension administration.
Experts have also observed with disdain that these elder statesmen who appear vulnerable at old age are being relegated, especially at the local government level. Sad to note that westernisation has eroded our traditional manner of taking care of our aged ones, especially in the face of the current economic realities.
With the acquiescence of the 2014 pension reform, the act is not left without flaws which have aggravated the plight of these elder statesmen. The flaws are indications that the changes made were not well thought through, hence, the ambiguities and inconsistencies within the extant laws.
On implementation, poor funding, political influence and control are impediments – a situation where political appointees mess up with pensioners’ funds (we shall see how later); state governments inability to receive counterpart funds due to their failure to pay state workers to the letter, inflated records (inaccurate figures) have made disbursement of fund a hard nut to crack. Evident, among others, was the corrupt practice that was exposed when a verification exercise in the military revealed over 23,000 fake pensioners in the army in the past.
Another major agony of pensioners has been the tardiness of pension disbursement. Industry watchers have observed how these senior citizens are ill-treated. Most PFAs and Pension Funds Custodians (PFCs) conduct prepayments verification exercise for retirees, sometimes under inclement weather conditions for two to four days. As a result, some pensioners slump in the queue while others die in the process.
Though the 2014 PRA as amended seeks to lessen the stress and wipe out the sharp practices like mismanagement of pension funds prevalent in the defunct scheme, yet the road has not been smooth reviewing the journey so far. For instance, “where two elephants fight, the grass suffers”, is a saying that has a direct bearing on the “conflicts of interest” and frictions between the federal and state governments in respect to Pension Reforms Act and its implementation. This is evident in cases where pensioners worked for both federal and state governments. Thus, some state governors remain adamant to reconcile and key into the new scheme.
Similarly, the apex pension body, PENCOM, has been found wanting in its duties to enforce regulatory compliances. For instance, PENCOM failed to enforce regulations stating that PFAs must report in a timely manner the value of their Retirement Savings Account (RSA). As a result, pensioners were unable to evaluate the pros and cons of investing in different PFAs.
People behind their agony
The worse deed one can do is to steal or deny “the golden handshake” from those who have spent most of their useful life working for another. Many factors and people at different segments of pension administration are instrumental to the exacerbation of pensioners’ agony. First and foremost is government at the three levels. Unarguably, the government set out the framework/structures through which the objectives of the pension administration and reforms are set and the means for regulations and implementations are achieved. But it is conspicuously seen that the structures, machineries for controls, the monitoring system, performance management techniques and other principles of quality corporate and public management and administration are lacking in Nigeria’s pension administration.
The integrity of persons sailing the ship of pension and disbursement in Nigeria overtime has been abysmally questionable. A heartrending act is when persons in high places deny the beneficiaries and next-of-kins (NOKs) what is due to them.
The case of Abdullahi Abdulrasheed Maina, former chairman, Presidential Task Force on Pension, who allegedly diverted N2 billion in pension biometric scam in November 2015, during Goodluck Jonathan’s administration, still has so many hearts bleeding till date.
Financial institutions like the PFAs and PFCs, Office of the Accountant General, Office of the Auditor General, Ministry of Finance and the likes are among those who have worsened the plight of these retirees by the stressful protocols they seem not to help matters, subjecting retirees to aching bureaucratic processes before they collect their stipend. In the same vein, employers of labour are in the league of those inflicting pains on retirees. They fail to do the needful adequately as and when due in the new Contributory Pension Scheme (CPS) as enshrined in the 2014 PRA as amended. As a result, there have always been insufficient funds for retirees at their exit from active service. The Nigerian Labour Union (NLU) and Trade Union Congress (TUC) are not at the vanguard to persuade the government to live up to its responsibilities in this regard since more attention is on active take home of the workforce. There seems to be a gap between active work life and the retirement world.
Way forward
Solutions to ameliorate the agony of retirees are not far-fetched if only we can do the right things at the right time and right places. We know that everything rises and falls on leadership. Political leaders have a lot to do across the three tiers of government. There will never be transparency, prudence, responsibility and accountability in pension administration if persons with dark and dubious hearts keep piloting pension administration.
At all levels, people with clean track records in integrity, compassion, empathy and godliness must be appointed to the pension administration. Major cankerworms that have bedevilled Nigeria are “nepotism cum cronyism”, but if the right persons are given the right jobs, the right things would be done without fear or favour of any kind. For instance, if the federal and state governments live up to expectations, there won’t be any need for bailout funds. The Federal Government should not be playing Father Christmas by paying outstanding salaries owed by state governments that fail in their moral and legal obligations to their employees. The Federal Government must show the moral and political will to comply and sustain the provisions of the PRA 2014 as amended, as the single largest employer of labour as well as the regulator and manager of the nation’s economy. They must also ensure that financial institutions like PFAs, PFCs, insurance firms, mortgage banks, state governments and employers of labour key into the CPS and comply with the provisions of PRA as well as other pension laws being enacted by various state governments.
Government, as well as other financial institutions, must be proactive to the plight of retirees. In the reviewed Pension Act of 2014, there is an urgent need to execute the Guaranteed Minimum Pension (GMP) as provided in Section 84 (1) of the PRA, which states thus: “That the RSA holders who have contributed to licensed PFAs for a minimum of years to be specified by the commission shall be entitled to a GMP as may be specified from time to time.” More so, PENCOM has been mandated to establish and maintain a fund known as Pension Protection Fund (PPF) for the benefit of all eligible pensioners approved and recognised under Section 82 (1) of the PRA 2014. The funds are to be used in exigencies and to be funded by the government and pension administrators.
“Withhold not good from them to whom it is due when it’s in the power of your hands to do it. Do not say to your neighbour, go and come again, tomorrow I will give you when you have it with you.” (Holy Writ).
A call has been made on the Senate to amend Section 7(1) of the PRA 2014 to allow for the lump-sum withdrawal of up to 75 per cent as against 25 per cent upon retirement considering the economic realities. In addition, there should be a continuous “training and education (in form of orientation and enlightenment programmes)” for workers; from “engagement to retirement” for in-depth knowledge and understanding of their fate after retirement. This will help them make wise decisions in this regard.
PENCOM should be strengthened to exercise full authority to oversee the affairs of all stakeholders in pension administration. As the apex pension body, they ought to identify and define clear roles and responsibilities for PFAs and PFCs, ensure internal control, disclosure of vital information to retirees, help them seek redress where and when necessary, and inculcate the spirit of discipline, accountability, transparency, prudence and responsibility in all pension administrators.
PENCOM must live up to its vision and mission statements. The new Single Window Policy should be implemented as a matter for urgency to ensure seamless pre/post retirement verification exercise as well as other protocols which pensioners pass through before they can receive their “deserved golden handshake.”
On a final note, there is no better time than now for all hands to be on deck for the timely implementation of all plans made, policies designed, resolutions reached and decisions taken unanimously to make life gratifying after retirement. A labourer is worthy of his wages.