National Pension Commission (PenCom) says it is working with other stakeholders to ensure that a considerable portion of the N5.8 trillion pension fund currently available in the pool is utilized in developing infrastructure and housing needs of Nigeria.
The commission has also created the Micro Pension Department to drag majority of Nigerians working in the informal sector into the formal pension system as a way of both securing their future and enlarging the largest pool of savings available in the country.
Head of Investment Supervision at PenCom, Mr. Ohimeme Ohioma who spoke during the Third Quarter Forum of Finance Correspondents Association of Nigeria (FICAN) at the Transcorp Hilton Hotel, Abuja on Tuesday said that by 2019, at least 40 percent of pension fund assets would be invested in infrastructure and housing.
According to him, the guidelines approved for investing pension funds stipulates that 15 percent can be invested in infrastructure bond while another five percent could be invested in infrastructure fund.
Incidentally he noted, only about four percent of the of the N5.8 trillion has been invested in infrastructure so far because investors are not taking advantage.
Ohioma explained that for projects to benefit from pension funds, there must be a full repayment guarantee by the Federal Government; strong political will; and transparency in development of the project.
He mentioned the advantage one advantage of investing pension funds in infrastructure is that the returns will not be eroded by inflation.
The Head of Investment Supervision disclosed that the PenCom Director General, Mrs. Chinelo Anohu-Amazu has held a meeting with Chairman of Economic and Financial Crimes Commission (EFCC) Mr. Ibrahim Magu to work out ways of ensuring that employers who deduct pension contributions from their staff without remitting are brought to book.
He said that very soon, such employers will be arrested and prosecuted.
Ohioma also stated that in responding to requests of many Nigerians working outside the formal sector to be captured in the contributory pension scheme, the new department to take care of workers in the informal sector.
The World Bank and other developing partners estimate that Nigeria has over 60 million working population but there are only about seven million contributing to the pension scheme.
Ohioma then said it was decided that this category of workers ought to be brought into the pension scheme and that very soon, the “Nigerians in the informal sector will have opportunity to make daily, weekly or monthly contributions into the pension scheme,” he declared.