16th June, 2010
The Lagos State Pension Commission has allayed the fears and apprehension of workers in the Lagos State public service about the security of their pension fund in the light of the recent unsavoury development in the banking sector.
Allaying the fears during a public awareness campaign on the new pension scheme at Alausa, the Executive Director, Technical Department of the Commission, Mrs. Folashade Onanuga enlightened workers that their contributions would be invested by the Pension Fund Administrators (PFAs).
She explained that for the allowable percentage of funds that can be invested in the money market instruments like fixed deposit, ”the Central Bank of Nigeria, CBN, has for now given guarantee on the funds”, adding that the maximum percentage that can be invested in money market instruments is presently 35 percent.
Answering question on what happens to pensioners fund in the event of liquidation of any of the PFAs, she stressed that since the PFAs only keep records of transactions, there wonâ€™t be any problem with the money because the pension funds/assets are held in safe custody by the licensed Pension Fund Custodians (PFCs).
She disclosed that it is the role of the PFAs to manage and invest the funds in line with the investment guidelines as laid down by the National Pension Commission, PENCOM.
â€œPension funds, according to the guidelines, can be invested in equities, bonds, real estate investments, money market instruments such as bankers acceptance bill, fixed deposits, treasury bills etc,â€ she said, adding that limits had been placed as to the percentage of funds that can be invested in each instrument.
On the right of public servants to transfer or change from one PFA to the other when not satisfied with the services rendered by a PFA, she cautioned that the window of transfer/change has not been opened by the National Pension Commission.
She assured that ”immediately the window is opened, LASPEC will inform workers so that they can exercise their right to change to another PFA.”
While admonishing workers to save for the rainy days, she also urged them to jettison the idea of spending their meager salaries on unworthy things, adding that part of the objectives of the commission ”is to assist workers to save for their retirement.”
She urged them not to hesitate to call on the commission for clarifications and assistance on any matter about the new pension scheme.