The Pension Fund Operators Association of Nigeria(PenOp) has described the Bill to Create a Police Pension Board as retrogressive and unsustainable.
A statement made available to the Aso radio said the Contributory Pension Scheme (CPS) which is in operation currently is very transparent.
“There is clear visibility into the amount of retirement benefits disbursed by all the PFAs. In contrast, other pension schemes operated in the past, outside of this framework, lack such transparency. The police are pushing to back to this non transparent system.”
The statement further explained that the withdrawal of the police from the CPS would entail a shift back to the defined benefits scheme, leading to the dismantling of the institutions, systems, and processes that the government has established to manage pensions effectively and the reversal is highly counterproductive and undermines the progress made thus far
“This would only add more financial burden on the government through unsustainable pension obligations that it has already made provision for through a private sector managed pension scheme.
“Unwinding investments destabilizes the financial system, diminishes assets, and jeopardizes the retirees themselves. Moreover, it disrupts fiscal policy and creates an unstable frnancial system.”
“The beauty of the CPS is that the benefit that accrues to one member within the scheme can be enjoyed by all the members. A standalone pension management system as the police is advocating will not benefit from this pooling effect.”, it added.
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