Contributors Role in the Contributory Pension Scheme (CPS) in Year 2022
The National Pension Commission has released the “Contributors Role in the Contributory Pension Scheme (CPS) in Year 2022” to enable contributors know their role under the Contributory Pension Scheme (CPS).
Dear Contributor, Please Know your responsibilities.
Ensure that you receive quarterly statements of your Retirement Savings Account (RSA) from your Pension Fund Administrator (PFA).
PensionNigeria Comment
PensionNigeria recommends that you should do this on monthly basis rather than quarterly basis to enable you discover errors immediately. If you discover any error you should contact your employer and PFA to resolve it immediately.
Review your Retirement Savings Account (RSA) statement to check the performance of the fund.
PensionNigeria Comment
You can do this by comparing the balance in your RSA statements on monthly basis, taking into consideration your monthly pension remittance. PensionNigeria recommends that you should also check out our Performance of all PFAs in Nigeria, where we state the % increase or decrease for all Pension Fund Administrators (PFAs) in Nigeria. Check it out here
Confirm that your employer is making complete monthly remittance to your Retirement Savings Account (RSA) i.e both employer and employee portions.
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
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).
Verify that your employer has subscribed to a Group Life Insurance Policy for you and the premium is being paid annually, consistent with the Pension Reform Act (PRA 2014).
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. If your employer does not have a Group Life insurance for its employees, or the employer is not paying premium to the insurance company to renew the Group Life Insurance annually, you have the responsibility to report this to PenCom. Check here for more on How to Report
Report non-remittance or incomplete 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
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