Jonathan signs Pension Reform Act 2014

President Goodluck Jonathan on Tuesday signed the Pension Reform Bill 2014 into law at the Presidential Villa, Abuja.

The new law, which is meant to govern and regulate the administration of the uniform pension scheme for both public and private sectors in Nigeria, repeals the Pension Reform Act, No.2, 2004.

The Bill was passed into law by the Senate on June 3, 2014 and the House of Representatives on May 27, 2014.

It was sent to the President for his assent on June 14, 2014.

The brief signing ceremony was witnessed by Vice President Namadi Sambo; Minister of Justice and Attorney-General of the Federation, Mr. Muhammed Adoke (SAN); acting Director-General, National Pension Commission, Chinelo Anohu-Amozu.

The highlights of the new law include the power vested in the pension commission to institute criminal proceedings against employers for persistent refusal to remit pension contributions.

The 2014 Act empowers PenCom, subject to the fiat of the AGF, to institute criminal proceedings against employers who persistently fail to deduct and/or remit pension contributions of their employees within the stipulated time.

This was not provided for by the 2004 Act.

The new law also reviewed upward the penalties and sanctions, having discovered that those provided under the old law were no longer sufficient deterrents against infractions of the law.

The new law allows PenCom to revoke the licence of erring pension operators but does not provide for other interim remedial measures that may be taken by PenCom to resolve identified challenges in licensed operators.

Accordingly, the Pension Reform Act 2014 now empowers PenCom to take proactive corrective measures on licensed operators whose situations, actions or inactions jeopardise the safety of pension assets.

This provision further fortifies the pension assets against mismanagement and/or systemic risks.