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State Governments should be serious on pension matters

There is a clear proof that majority of state governments in Nigeria are not serious about pension matters, which they manage in an ambivalent way. The states concerned in this regard seem to hold pensioners and pension matters in contempt to the extent of refusing to make clear provisions for pension payments in their annual budgets.

The outcome of a research conducted for this piece indicates that the budget speeches of most state governors in the country for 2019 did not accord pension matters specific attention. “Pension,h where it is mentioned, was largely treated as a mere word. At best it is buried in sentences on workers  salaries without clearly stating any specific amount of money pledged for the payment of pensions.

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Another indicator of the unserious manner in which state governments treat pension matters is their reluctance, if not outright refusal, to embrace the Contributory Pension Scheme. In the few states where it is in place, it is being implemented half heartedly. Remittances are either irregular, or the money in the Retirement Savings Accounts is wasted by investing it in unviable, poorly-conceived and badly implemented projects.

This is possible because most members of most states houses of assembly who decide on laws were cajoled, induced or intimidated by overbearing state governors to pass Acts establishing the Contributory Pension Scheme (CPS) devoid of the necessary safeguards that will give strong protection to the money in the RSAs.  By doing so they jettison the guidelines issued to the states by the National Pension Commission.

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The mishandling of pension matters by most state governments in the country has definitely contributed to the spread of old age poverty among retirees. This reality is a painful one, which casts doubts on the quality of public financial management orientation in the states.

Even though majority of the state governments do not show much care or pay attention to pension matters, there are shining examples of state governments that respect pensioners and accord payment of pensions the importance it deserves. These few states have done their homework properly and have evolved a sustainable way of paying both pension and staff salaries regularly.

It is inevitable to mention Lagos state. This state is among the less than 10 states, which includes Jigawa, where pensioners are treated with the respect they deserved through regular payment of their monthly stipend without much hassling.

The few states that made clear provisions for pensions in their 2019 budgets to my knowledge include Edo State, which proposed N9 billion for the payment of gratuity, pension and arrears of pensioners. Rivers, which proposed N33 billion for pensions and gratuities for 2019. Ogun State has proposed N22.200 billion in 2019, or 5.51 per cent of the statehs total recurrent expenditure for pensions and gratuities.  The Bauchi state government has allocated N10 billion in the 2019 budget.

The fact that Jigawa state that has by a huge margin less revenue than Lagos can match that state in the league of states that pay salaries and pensions regularly shows the high quality of the public financial management installed there.  The Jigawa state government is effectively implementing a modified Contributory Pension Scheme sincerely,  thereby achieving the goal of paying pensioners their monthly  stipends as and when due. The published Jigawa State Appropriation Act for 2019 shows a clear provision of N600, 000,000 in a specific vote of charge for the payment of pensions. It has also delightfully set aside sufficient money in a different vote of charge for the administration of salaries and pensions payrolls. This is heart-warming and praiseworthy.

The states that care for pensioners by making specific provisions for pensions in their 2019 budget and follow it up with actual payment deserve commendation. The National Union of Pensioners should institute an annual award for state governments that pay pensions as and when due.

 

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