Contributors Role in the Contributory Pension Scheme (CPS) in Year 2021

The National Pension Commission has released the following to enable contributors know their role under the Contributory Pension Scheme (CPS).

Dear Contributor, Know your responsibilities.

Ensure that you do not open more than one Retirement Savings Account (RSA)

PensionNigeria Comment
A person can only have ONE Retirement Savings Account, under no circumstance is a person allowed to have more than one Retirement Savings Account, even if you change employer or change Pension Fund Administrator (PFA) you must still maintain the same RSA number.
If you move from one employer to another, all you need to do is to give your new employer your Retirement Savings Account number to enable the employer add your name to their pension schedule and you should also contact your Pension Fund Administrator and inform them that you have changed employer to enable them update their records.
If you change PFA, you should advice your employer of your new PFA to enable your employer send your pension contributions to the new PFA.
If you have two RSAs it is advisable that you contact the PFAs to update your records.

Confirm that your employer is making complete monthly remittance to your Retirement Savings Account (RSA) i.e both employer and employee portions.

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PensionNigeria Comment
The Pension Reform Act 2014 mandates that the employee must contribute a minimum of 8% while the employer must contribute a minimum of 10% of the employee’s total emoluments. The amount remitted into your RSA must be stated on your payslip, to re-compute the amount,
Basic Salary + Pensionable Allowance * 8% = Employee portion
Basic Salary + Pensionable Allowance * 10% = Employer portion
If your employee and or employer percentage is above the minimum, you should use the % to replace the 8% and 10% in the formula above.
The amount stated as pension contribution on your payslip must also be the same amount stated in your Retirement Savings Account (RSA) Statement from your Pension Fund Administrator (PFA).

Ensure that you receive quarterly statements of your Retirement Savings Account from your Pension Fund Administrator.

PensionNigeria Comment
PensionNigeria recommends that you should do this on monthly basis rather than quarterly basis to enable you discover errors immediately.

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Report non remittance of your monthly pension contributions to the National Pension Commission (PenCom).

PensionNigeria Comment
We would recommend that you should not only report non remittance but also report incomplete remittance of your monthly pension contributions to the National Pension Commission (PenCom).
check here for more on How to Report https://www.pensionnigeria.com/faq/what-can-i-do-if-my-employer-refuses-to-remit-my-pension-contributions/

Review your Retirement Savings Account (RSA) statement to check the performance of the fund.

PensionNigeria Comment
You can basically do this by comparing the balance in your RSA statements on monthly basis. PensionNigeria recommends that you should also check out of Performance of all PFAs in Nigeria where we state the % increase or decrease for all Pension Fund Administrators (PFAs) in Nigeria. https://www.pensionnigeria.com/tag/return-on-investment/

Verify that your employer has subscribed to a Group Life Insurance Policy for you and the premium is being paid annually, consistent with relevant laws.

PensionNigeria Comment
Pension Reform Act 2014 mandates that every employer shall maintain a Group Life Insurance Policy in favour of each employee for a minimum of three times the annual total emolument of the employee and premium shall be paid not later than the date of commencement of the cover. check here for more on How to Report https://www.pensionnigeria.com/faq/what-can-i-do-if-my-employer-refuses-to-remit-my-pension-contributions/

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