Wednesday 25 April 2018
C002D5556
Pension Today
BUSINESS DAY
27
In Association with
‘Enlightenment remains strong focus to sustain achievements in pension reform’ The Pension Fund Operators Association of Nigeria (PenOp) recently elected a new executive team with Ronke Adedeji, managing director/CEO, Leadway Pensure PFA emerging as president. The new executive team in this interview shares their vision and expectations for the nation’s pension industry. Excerpts: You have just been elected the new executive of PenOp.What is your vision for this body and the pension industry? e are fortunate that over the years we have been able to build a solid foundation both as an industry and an association. The industry has proved itself that it is here to stay. Even though we have our challenges, but reasonably we have made some progress. The pastexecutiveshad built a strong foundation upon which we are going to continue, so, we are looking to build on what they have done. So, enlightenment remains a strong focus. Despite what has been achieved, there is still a lot of wrong perception and lack of information in the public. So, for us, that is a major concern. So, we are going to continue to talk about the scheme,its benefits, achievements and challenges facing us. If you look at Nigeria, and where we are coming from, you will see that the CPS has made a lot of difference in people’s life and sometimes this is underestimated. Today, you have people who have got huge savings, whereas ordinarily they would not have had a savings for retirement. Another issue we are also going to look at is how to project the pension industry in the financial service sector. It is a significant part of the financial sector, and so we want to continue to project our presence, increase our visibility and drive initiatives. Very often, we see thingscrossto our door step, all those issues are going to be properly addressed. You hear discussions around,what are you doing with this fund?There are always discussions around infrastructure, you hear various
W
versions of what this money should be doing, and all that. But also remember that we have fiduciary responsibility to our clients. It is not for the money to be used anyhow, so we cannot do things anyhow. So,we must make sure that there is a systematic, structured and well thought out way of using the money for the benefit of our clients. Other initiatives will also come up this year, including alternative asset classes as well asinfrastructure investment, that will also enable us improve returns on investment for our clients. We will also continue to improve on our relationship with PenCom. Thank God we have a good regulator, so we will continue to ensure that loopholes that exist in the system are closed and the industry is moved to the next level in terms of service delivery and efficiency. You mentioned about challenges. One which is dear to contributors is the transfer window.How prepared is your association to drive and see that this comes to pass? It is a burning issue and I think what has been the challenge is the issue of biometrics. We are optimistic that it will be resolved very soon. I think the government has issued instruction that everybody should consolidate in terms of identification and there is work going on in that regard. I think we have a meeting soon that will set the platform for further discussion about the transfer window. I see progress in that area shortly. There are pending issues including the Minimum Pension Guarantee (MPG) that was supposed to have been instituted, as well as mortgage from pension, what is the association going to do about these? On the MPG, one of the key
R-L:Wale Odutola, head of Branding; Dapo Akisanya, head of Technical; Susan Oranye, executive secretary, Aderonke Adedeji, new president; Akeeb Akinola, vice president; Chinedu Ekeocha, treasurer and Hamza Bokki, head of Legal & Regulatory Commission, all of the Pension Fund Operators Association of Nigeria after election of new Executive Committee in Lagos.
requirements is that government must be making a certain contribution as well, but that is one of the challenges we have faced. But on the Pension Protection Fund, that has started receiving funding from the operators. I think this is the second year since we started marking contributions to that effect, while we expect government to also start making its own counterpart funding. But when that will start, I cannot be able to say right now. But it’s something we are also keen to see happen, and we are speaking with PenCom to help persuade government to ensure it comes to pass. On the issue of mortgage financing, PenCom is poised to ensure that this is done having given us a draft guideline. However, what has occurred is that at the government side, they have one or two other initiatives, which to them has become a priority.So, for example, there is something called Family Homes Fund, which
RC634453
Diamond Pension Fund Custodian Limited 1A, Tiamiyu Savage Street, Victoria Island, Lagos State. Tel: 01-4613753, 2713680, 2713954 Fax: 01-2713955 Email: info@diamondpfc.com Website: www.diamondpfc.com
the ministry of finance was promoting something last year , which suggest that there may be need to suspendimplementation of the 25 percent contribution for mortgagein the mean time. So, right now, most of the emphasis is on the family homes fund. However, we are still continuing discussion with stakeholders in the mortgage industry even if we do not continue with that provision in the guideline, to see how else as an industry we can support a thriving mortgage industry to provide affordable housing to our contributors. Hopefully, this year we will make significant progress and members of the public will start to see impact. There is huge potentialfor pension penetration at the State level, what has PenOp done in terms of creating awareness and engaging the States? With the states, the truth is that it is a long and pain staking process. Sometime last
year, PenCom and PenOp had a joint committee that was going round the States. Work is going on, but like I said, it’s long and pain staking. For lot of States, you cannot go in and get a yes for an answer. It literally does take years to talk to the executive, labor, and the various stakeholders. There is a process that is ongoing, and we are doing that jointly with PenCom and I believe that will continue. The States are at different stages of implementation, but the good thing about it is that some progresses are being made. As body how do you address issue of ethical practice and corporate governance failures amongst your members? Well, I am not very clear as to what issues you are talking about. But, I will give a general answer, may be if it is in terms of payment to retirees. When it is payment to retirees, there could be some issues. May be if the account is not funded in the first place,
you will find that the retiree is totally dissatisfied. It is his PFA as far as heis concerned that is responsible for his nonpayment. It is possible that there are other various issues, but as a self regulatory body, there is a lot of collaboration within ourselves. In the event that we find specific House erring, the first point of call is the regulator. But before it gets to the regulator, if brought to us, either as the Exco or a body we reach out and speak to the specific houses. Sometimes also, PenCom may be privy to the information we don’t have because they go inand do inspection. But as a body, we work together, we cooperate,we collaborate and alsoare able to interactand exchange information. For example, if you go to the field and find may be agent of another PFA having misssold, such information always come back, and among the CEO’s, these things are resolved. For instance, I have had a situation whereby my staff reported a matter to me and I took it up with the CEO of the other PFA. They investigated it and it was dealt with. There is that level of collaboration between us. If I may ask, is the micro pension initiative dead? No. it cannot die. We will not let it die. For us as an industry, it is a very important aspect of the business because it is where growth is going to come and we are very anxious to see it happen. Just look at it very well, until we start covering the informal sector very deeply the growth we are looking for may not come, so it’s an important aspect of the business we are looking forward to. Just like the issue with transfer window, micro pensions will require that issues around identification is gotten right first of all.
This section is created to increase awarness and deepen knowledge about the contributory pension scheme. If you have enquiries or contributions, send to this e-mail: diamondpfcbusday@yahoo.com