Over 23 Nigerian Companies Fined N295.45 million For Failing To Pay Employees’ Pension

The National Pension Commission (PENCOM) penalised 23 companies for failing to remit its employees pension contributions, as the regulator recovers N422.34 million from the defaulters in First Quarter (Q1) 2022.

According to the Q1 report released on Tuesday, which covers the month of January to March, the organisations were fined N295.45 million, while the Commission has began legal action against six employers among the defaulters, for refusing to pay despite effort to make them.

It was gathered that the N422.34 million recovered from the defaulters, is below the N608.55 million PENCOM reported as recovery in the corresponding Q1 of 2021. The amount for Q1 this year is splitted into N295.45 million penalty, and N124.89 million principal contribution expected from the companies.

A breakdown of contributions into individual retirement savings accounts (RSAs), showed the public sector contributed N90.33 billion to Pension Fund Administrators (PFAs), against the N101.11 billion contributed by the private sector.

This raises the total pension contributions in the hands of PFAs from N7.58 trillion reported for the period of Q4 2021, to N7.77 trillion as of Q1 2022, with the private sector accounting for N3.76 trillion, while the public sector holds N4.02 trillion.

However, the report stated that the total value of pension fund assets is N13.88 trillion, as of March 31, 2022, breaking it down into, “N9.81 trillion in RSA’ Active’ Funds (RSA Funds I, II, III and V); N1.10 trillion in RSA Retiree Fund (Fund IV); N1.54 trillion in CPFAs; N1.42 trillion in Approved Existing Schemes. Fund VI Active and Retiree Fund amounted to ₦23.16 billion.”

Meanwhile, the commission said over 11,200 organisations applied for pension clearance certificates (PCCs) in the first quarter, but 10,541 employers were issued, with 659 applications in approval process.

“Out of this number, PCCs were issued to 10,541 organizations, while 659 applications were in the approval process as at March 31, 2022.” The Commission said, adding, “The records showed that the 10,541 organizations had remitted a total of N59.39 billion into the retirement savings accounts (RSAs) of their employees, totaling 45,170.”