Nigeria: Pension Fund Administrators Exploiting Pensioners

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Nigeria: Pension Fund Administrators Exploiting Pensioners

Nigerian workers have been faced with different challenges over the years. All of these challenges hinge around government’s insensitivity to their plight. We have heard stories of pensioners not receiving their pensions and we have even heard of those that collapse and even die while waiting to be paid.

Given all of these, Nigerian workers thought their woes were over with the introduction of PFAs which allowed their funds to be managed by independent organizations. This appears not to be the case.

While we’ve learnt that the Federal Government for about the past two years has not been remitting to the PFAs the deductions they make from the salaries of their employees not to mention the contributions they are supposed to make, we’ve also learnt that the PFA’s themselves have been setup to rip Nigerian workers off.

In a shocking breakdown of the terrible plan that is called Pension Fund Administration, we find that Nigerian workers are being setup to be ripped off big time by the PFAs. This can only be with the connivance of the government who themselves have not been remitting the deductions that they have not failed to make monthly and have also not been paying the part to match the contribution of the workers.

A break down of what has been happening in this scheme was given by one Adoga Michael Oyi and you can find his explanation below:

“All of us will get old one day… few years to come it will be your turn!

“The current pension manipulations should be stopped by Nigerians now!
“I was very happy when the Senate recently made a move to amend the Pensions Act to enable Nigerians withdraw up to seventy five percent of their cumulative savings. The liberty should even extend to allowing pensioners withdraw their whole sum if he/she so wish. The law could also give pensioners the liberty to either withdraw their total sum or give the Pension Administrators the kind of investments they want with their hard earned funds.
“After spending sixty years or thirty five years of active service to your nation gathering all types of experiences finance, administration etc. PFAs still term you as novice; you don’t know how to handle your hard earned entitlements!
“I will make a simple illustration here:
“MR.  A retires at sixty and has =N=20m as his savings.
He accesses 50% of =N=20m which equals =N=10m.
“The balance =N=10m is to be spread over 180 months (15years) and MR. A earns =N=55,555 monthly for 15 years and he stops earning anything because he is expected to die at 75.
“If MR. A  will be allowed to have his total sum of =N=20m, ceteris paribus (all things being equal), he could invest in the Money Market or Government Treasure Bills. Currently and authoritatively =N=20m can fetch up to a maximum of 15%pa on a span of four consecutive 90 days tenor. Meaning =N=20m gives about =N=3m per annum. Divide =N=3m by 365 days and multiply by 30 days gives MR. A, a monthly earning of =N=246,575 without depleting his capital of =N=20m
“Why have we been quiet. Nigerians should wake up from this very deep slumber. The sum given to an average pensioner is not up to the interest the Administrators make on his/her savings. This manipulation/exploitation made PFA among the most lucrative businesses in Nigeria currently.”
Who will save the Nigerian worker from this fraud and insensitivity? What is the NLC doing about this or are they also in cahoots with the PFAs?

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