TITLE:
The Nigerian Contributory Pension Market: A Review of Compliance Status across the Federation
AUTHORS:
Cosmas Ogobuchi Odo, Christopher Chukwudi Orga, Kenneth C. Ozoemenam
KEYWORDS:
Pay-As-You-Go, Pension, Political Risks, Compliance, Guaranteed Minimum Pension
JOURNAL NAME:
Journal of Financial Risk Management,
Vol.8 No.3,
August
30,
2019
ABSTRACT: The paper reviews the compliance status of the Federal, State and private
sector pension systems in Nigeria after the reform in 2004 that changed the
funding strategy from pay-as-you-go to the contributory modality. It first
spotlighted the grim factors of the old pension system that made reform inevitable.
The paper in the main argues that compliance with the provisions of
the law remains the only guarantee of workers’ retirement future. It further
points out the specific role labour leadership must play in this regard. The
paper disclosed that the observed failure to implement the provisions of the
law across the tiers, especially the federal and state government segments,
arose in part due to a conspiracy of factors, including, recession, legislative
loopholes, supervisory negligence, and absence of sustained engagement of
labour leadership with employers across the tiers. The paper therefore concludes
by recommending a more focused engagement strategy by labour leadership
and a stricter penalty that makes default in making contributions less
attractive.