Penalties imposed on defaulting employers under the Contributory Pension Scheme (CPS) have increased the rate of remittance of pension contributions into employees’ pension accounts, the Retirement Saving Accounts (RSAs).
The Regional Manager, Trustfund Pension Limited, Mr Obiora Ozoekwem spoke at the 2019 Employers’ Forum in Lagos.
He said the scheme faces the challenge of some employers not remitting up to date.
Ozoekwem said most of the employers remit in arrears and this has led to backlog of remittance, thus making it difficult for them to be up to date.
He said as a Pension Fund Administrator (PFA), they always organise fora to sensitise employers on how they can be compliant with the scheme.
He said: “The forum is a gathering where we sit with employers under our management and bring them up to speed on some things they need to know and new happenings in the industry. We also discuss certain challenges we are having in terms of contributions and registrations among others.
“We also discuss the challenges that we encounter in their operations as regards the pension administration. The first challenge we encountered with the employers started from the point when we have to talk to the employees to enroll under the scheme. We let them know that the responsibility to enroll laid with the employer because when a new staff joins an organisation, the employer is supposed to enquire whether the staff has been registered with a PFA or not.
“In the case where he has not, the employer ought to allow him make a choice of PFA. But in a situation where he has registered with a PFA, the employer should not be found forcing him to leave where he is registered to join another. So, we make them to understand that the choice of a PFA lies with the employee and then the responsibility of ensuring that everybody has a pin lies with the employer.
“At the point where the employee comes in and he doesn’t have a pin, the employer is mandated to after 6 months call for a temporary pin for the employee. The employer will then begin to remit his pension funds into the employees’ RSA account,” he added.
