331k out-of-job Nigerians withdraw from pension savings

The National Pension Commission (Pencom) says 331,003 retirement savings account holders who were out of jobs withdrew N116.88 billion from their contributions.

This was contained in the third quarter 2019 report recently released by the commission.

Section seven, subsection two of the 2014 pension reform act gives room for a worker who voluntarily retires, resigns or sacked from paid employment to access 25 percent of his RSA if he is unable to get another job after four months.

In the third quarter of 2019 alone, Pencom said 6,862 RSA holders under the age of 50 were paid N3.67 billion.

Of this figure, 6,034 were from the private sector, 701 from the state section of the public sector and 127 were former federal employees.

“Approval was granted for payment of N3.67 billion to 6,862 RSA holders who were under the age of 50 years and were disengaged from work and unable to secure another job within 4 months of disengagement,” the report read.

“The cumulative total number of RSA holders who were paid benefits for a temporary loss of job was 331,003 and were paid a total of N116.88 billion being 25 percent of the balances of their RSAs as prescribed by the Pension Reform Act 2014.

“Further analysis showed that the private sector accounted for 95.17 percent of those who benefitted from these payments while the public sector accounted for 4.83 percent.”

A statement on Monday by Peter Aghahowa, Pencom head of corporate communications, said the federal government has paid N14.92 billion to settle the accrued rights for retirees under the contributory pension scheme (CPS).

The amount will cover four months arrears.

The accrued pension rights represents an employee’s benefits for the past years of service up to June 2004, when the Pension Reform Act that birthed the CPS, came into effect.