PenCom’s Commitment to Nationwide CPS Compliance

The National Pension Commission (PenCom) remains unwavering in its commitment to ensuring full nationwide compliance with the Contributory Pension Scheme (CPS). Recognizing the critical role of pensions in securing the financial future of Nigerian workers, PenCom continues to engage with state governments, private sector organizations, and other stakeholders to drive the full adoption and implementation of the scheme across all sectors.

Strengthening Regulatory Oversight

As the primary regulatory authority overseeing pension administration in Nigeria, PenCom has developed robust policies and frameworks to facilitate the smooth transition from the old Defined Benefits Scheme (DBS) to the CPS. The Commission actively monitors compliance levels and provides technical support to state governments to help them align with the Pension Reform Act (PRA) 2014.

PenCom’s oversight functions include:

• Ensuring adherence to CPS guidelines by both public and private sector employers.
• Conducting periodic audits and compliance checks to track the remittance of pension contributions.
• Reviewing and approving state pension laws to ensure they meet national standards.
• Providing advisory support to states that are in the process of adopting the CPS.

Encouraging Full CPS Implementation Across States

Despite the legal mandate for the CPS, many states have yet to fully comply. PenCom continues to engage non-compliant states by:

• Conducting stakeholder engagements with state governments to highlight the benefits of full CPS implementation.
• Developing Model State Pension Laws to guide states in domesticating pension regulations.
• Providing implementation roadmaps to states transitioning from the DBS to the CPS.

Recognizing CPS-Compliant States

As part of its strategy to encourage compliance, PenCom regularly acknowledges states that have successfully implemented the CPS. Fully compliant states, such as Lagos, Osun, Kaduna, Ekiti, Edo, Ondo, Delta, Benue, Anambra, Jigawa, and the Federal Capital Territory (FCT), serve as benchmarks for other states.

These states have demonstrated best practices in pension administration by:

• Ensuring timely remittance of pension contributions.
• Setting up dedicated pension bureaus to oversee CPS implementation.
• Providing group life insurance coverage for employees.
• Funding Accrued Pension Rights to ensure retirees receive their benefits promptly.

Addressing Challenges in CPS Implementation

While progress has been made, challenges remain, particularly in states that have either partially implemented the CPS or have yet to adopt it. Common issues include:

• Delayed remittance of contributions, leading to pension arrears.
• Failure to conduct actuarial valuations, which affects accurate pension liability assessments.
• Lack of adequate funding for Retirement Benefit Bond Redemption Fund Accounts.

To address these challenges, PenCom is intensifying its advocacy efforts and working with key stakeholders, including state governments, pension fund administrators (PFAs), and labor unions, to ensure greater compliance.

The Way Forward: A Fully Pension-Secure Nigeria

PenCom’s vision is clear: a Nigeria where every worker is guaranteed a financially secure retirement. To achieve this, the Commission will continue to:

• Enforce strict regulatory compliance through penalties for non-compliant employers.
• Expand public awareness campaigns on the importance of the CPS.
• Strengthen collaboration with financial institutions to ensure efficient pension fund management.
• Support technological innovations that enhance transparency and efficiency in pension administration.

A pension-secure Nigeria is not just a goal but a necessity. Through sustained efforts, policy enforcement, and stakeholder collaboration, PenCom remains fully committed to ensuring the full nationwide implementation of the CPS, safeguarding the retirement future of millions of Nigerians.

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