In this post, we look at the functions of the National Pension Commission (PENCOM). PENCOM help regulates the activities of managers of pension funds. Other functions will be discussed in this article.
There were some issues surrounding the pension scheme in the country, some employees were omitted, not covered in the scheme.
Unfortunately too, this scheme was not properly financed, the little funds located to the pension scheme were characterized with fraudulent acts and malpractices perpetrated by trustees of the pension money and those who manage the funds.
These practices have called for proper management of pension funds perhaps, this led to the pension reform initiated during Olusegun Obasanjo’s administration with a view to addressing Nigeria’s pension scheme problems. That was the 2004 Pension Reform Act.
Functions of the National Pension Commission
So many functions have been assigned to the National Pension Commission so as to help regulates the activities of managers of pension funds and ensure that there is efficient management of the scheme.
In this article, we are going to look at the functions of the National Pension Commission together, and here are there:
1. Regulates Pension Scheme
The major function that led to the establishment of the National Pension Commission was that of regulating the pension scheme.
The Commission is saddled with the responsibility of ensuring that the activities within the scheme are regulated.
Apart from regulating the scheme, the National Pension Commission was also expected to supervise the pension scheme for the purpose of ensuring effective administration of the scheme.
2. Issues Guidelines For Pension Funds’ Investment
Pension funds, in essence, are not tied down, managing pension funds simply means investing pension money efficiently with a view to earning a return on Investment. When pension funds are properly managed, the likelihood is that making a profit will become inevitable.
So there would be enough funds for reinvestment, and to settle retired public servants. Now to achieve this laudable task, it is incumbent on the National Pension Commission to issue guidelines that would assist or help in Investing pension funds efficiently and prudently. This has remained one of the functions of the national pension commission.
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3. Supervises, Approves And Licences Pension Funds Administrators
It has been the function of the national pension commission to approve pension funds administrators and every other authority that are custodians of the pension funds, including institutions, whose business has to do with pension matters.
Before the approval of the pension administrators, by the national pension commission, there are things that might have been taken into consideration on the part of the national pension commission, and these include, perhaps, the pension funds administrators might have been licensed by the Commission, and then for the Commission to realize its goal, it must regulate, as well as supervises the pension funds administrators. This normally happened at the discretion of the Commission.
4. Establishes Pension Funds Management’s Standard
It remains the duty of the national pension commission to ensure that standard is set when it comes to managing pension funds by the pension fund administrators.
While such rules and standards have been set by the national pension commission, it is expected of the pension fund administrators to adhere to these standards and rules and regulations.
More so, it is also the national pension commission’s function under the Act to enforce total compliance on the part of the pension fund administrators to the laid down rules and regulations.
5. Maintains National Data Bank On Pension Matters
The Act that empowered the national pension commission has clearly defined the functions of the national pension commission, and one of such functions is to ensure that, there is an establishment of the national data bank, that would take care of all matters relating to pension administration.
On establishing this national data bank on matters concerning pension, the national pension commission should be in readiness to maintain this data bank for optimal administration of the pension scheme.
6. Carries Out Public Awareness On The Scheme
It is part of the functions of the national pension commission to undertake public awareness campaigns in relation to the establishment of the pension scheme with a view to educate members of the public, particularly the retirees on the existence of the scheme, as well as, the management of the scheme.
This development on the part of the national pension commission is very necessary because it will ignite hope of being settled of the retirement benefit among the retired public servants’ population, as well as keeping the public abreast of the activities of the scheme administrators.
7. Promotes And Embarks On Capacity Building Of Personnel:
The national pension commission has realized the importance of upgrading the skills and the knowledge of the person administering the pension scheme, as well as managing the pension funds particularly, in this era of a technology-driven society.
And so, has been promoting manpower development within the scheme, even as it embarked on capacity development of personnel in order to ensure a better disposition of the member staff in carrying out their responsibilities efficiently.
Through the promotion of capacity development, the national pension commission has institutionally strengthened administrators who manage pension funds.
8. Receives And Investigates Into Complaints
Since it is the functions of the national pension commission to regulate the pension scheme, supervise the activities of the scheme as well as enforce compliance to the rules and regulations of the scheme, the national pension commission is also saddled with the responsibility of receiving complaints, where there is impropriety mated against a fellow pension funds administrators.
In a situation where there are such issues, the attention of the national pension commission is not limited to the pension fund administrators, it cuts across the entire staff of the scheme, should there be any of such impropriety levelled against each other.
9. Performs Other Duties Expedient In Discharging Its Functions
The national pension commission has been empowered to carry out other responsibilities deemed necessary by the national pension commission in carrying out its statutory functions, in as much as such responsibilities would lead to the attainment of the national pension commission’s goals.
Malpractices on the part of the pension funds administrators have called for proper management of pension funds perhaps, this led to the pension reform initiated during Olusegun Obasanjo’s administration with a view to addressing Nigeria’s pension scheme problems. That was the 2004 Pension Reform Act, which was to ensure efficient management of pension funds by pension scheme administrators.
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