New Pension Scheme, Recipe for Anarchy

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New Pension Scheme, Recipe for Anarchy - OPS

By Chris Nwachuku, ThisDay News

October 2, 2003

The Federal Government's proposed new national pension scheme suffered another major setback as Manufacturers Association of Nigeria (MAN), Nigeria Employers Consultative Association (NECA) and Nigerian Association of Chambers of Commerce, Industries, Mines and Agriculture (NACCIMA) dismissed it as a recipe for anarchy.

Particularly the bodies operating under the umbrella of Organised Private Sector (OPS) in a position paper made available to THISDAY, said the bill if imposed on the private sector would create crises in the more secured work environment.

The new pension bill is expected to repeal the Pension Act of 1990 and establish contributory pension scheme for employees in public and private sectors. Last week, Nigeria Labour Congress (NLC) and the 29 affiliate unions rejected the bill contending that the new scheme had the capacity to impoverish Nigerian workers.

However, why the OPS acknowledged the need for a reform of the existing pension system in the country, it frowned at the inappropriate and undue haste being adopted by government to merge public and private sector workers into one scheme amid the visible structural and technical differences.

Specifically, MAN, NECA and NACCIMA said that the major problems of pension fund in the country today is mostly restricted to the public sector and demanded that a critical attention should be paid that sector alone.

"We want to stress again that we are against any harmonisation of public and private pension fund. We see this as a recipe for anarchy."

The bodies urged government to restrict the reform to the public sector and take the form of defined contribution as already well-espoused in the draft act.

"In view of the elaborate and complex structure articulated in the draft act for managing pension fund, it will be rather inappropriate and hasty to extend this to the private sector when it is yet to be tested in the public sector."

The bodies added "Any attempt to foist this on the private sector will lead to instability in an already secured sector."

On the fate of Nigeria Social Insurance Trust Fund (NSITF), OPS reaffirmed its confidence in the scheme and demanded that it should be left alone to cater for the pension needs of the private sector workers.

It requested that the current board of the fund be allowed to complete the ongoing restructuring programme, which the three institutions noted has already been yielding fruits of guaranteed pension pay and effective administration.

The cost of running the administration of the fund by the Alhaji Rufai Mohammed team, said OPS, conforms with the International Labour Organi-sation (ILO) recommended level, which is minimal.

The bodies, however, said that they were ready to accept national pension regulatory body that will monitor and supervise all pension fund schemes in the federation, whether public or private.

"Therefore, as at today, the OPS is satisfied with the NSITF as a vehicle for protecting and securing the post-employment quality of life of contributors, through a meaningful pension of which the minimum amount payable currently stands at 80 per cent of the maximum wage."

The Directors-General of the three institutions O. A. Oshinowo of NECA, Engineer O. O. Akinpele (MAN) and L. O. Adekunle (NACCIMA) who signed the OPS position also denounced plans to scrap the existing private pension fund scheme.