Pensions Board Tenure Ends. Without Licensing A Scheme

 

 

The three-year tenure of the National Pensions Board has ended without the licensing of a pension scheme to begin operations.

Despite this situation, employers have been remitting five percent of their employees’ salaries to the Temporary Pension Fund (TPF) since January 2010.


The National Pensions Act, 2008 (Act 766) seeks to create a unified pension system under a three-tiered pension structure, with Social Security and National Insurance Trust (SSNIT) as the operator of the First Tier, and Approved Trustees (Corporate Trustees) as operators of the mandatory Tier 2 and Voluntary Tier 3 schemes.


The board of National Pensions Regulatory Authority (NPRA) was established in September 2009 to oversee the implementation of the new pension’s reforms in the country.


To begin the implementation, the NPRA set up a TPF in January 2010 to provisionally administer Tier 2 pending the licensing of Trustees.


In October 2011, the NPRA issued the needed administrative guidelines to make way for the full implementation of the Act.


Subsequently, corporate trustees, fund managers and pension fund custodians purposely established to fully administer the Tiers 2 and 3 schemes were licensed on March 16, 2012.


However, a licensed Corporate Trustee, who pleaded anonymity, told CITY & BUSINESS GUIDE that presently the needed arrangements had been put in place for the pension schemes to be licensed by the NPRA.


“NPRA has still not licensed any scheme after three years of its creation, and we wish to bring to working public’s attention some of the grave concerns that threaten the pensions industry, and together with all stakeholders, demand government’s immediate action to forestall the collapse of the pension system.
“The snail-pace approach adopted by the NPRA gives reason for worry,” the source hinted.
According to the source, more recently the NPRA set three deadlines for scheme licensing and failed to adhere to them.


The first deadline of 30^th of April, 2012 was later moved to 30^th June, 2012 and then subsequently to 31^st August, 2012.


The last deadline has ended without the licensing a single pension/provident fund scheme.
When contacted, Sam Pee Yalley, Chief Executive Officer (CEO) of NPRA, told this paper that the Authority has not delayed the implementation of the scheme.


“Government has given us the mandate to ensure that people’s life’s savings are kept properly, so we are not going to rush anything in the interest of any party or parties.”


He added that “this is an important project and the schemes require a lot of input, which we going to take our time to put it in place.”


“Pressure will not push me to send people’s money to just any company,” he emphasized.
He however appealed to the general public and workers to exercise restraint.