EXAMINATION OF CONTRIBUTORY PENSION ASSET IN NIGERIA’S PRIVATE AND PUBLIC SECTORS

AYUBA, Philemon Danan
Department of Insurance and Acturial Science
Faculty of Management Sciences
University of Lagos, Akoka, Lagos State
ayubaphilemond@gmail.com
ADELEKE, Ismail Adedeji
Department of Insurance and Acturial Science
Faculty of Management Sciences
University of Lagos, Akoka, Lagos State
iadeleke@unilag.edu.ng
NAFIU, Najimu Ayinde
Department of Insurance
School of Management Sciences
Federal Polytechnic Ilaro, Ogun State
nafiunajm@yahoo.com
ABSTRACT
The compulsory contributory pension scheme seeks to among others ensure every eligible retiree enjoys
retirement benefits upon retirement from the contributions saved while working by way of regularly
periodic payments. Therefore, the pension contributions are the total contributions of both employer 10%
and employee 8% accruing from the employees’ monthly salary prior to retirement. The study employs the
Pareto chart analysis using secondary data from the pension commission with a view to examining the
contribution trend and contributions made by total public and private companies’ pension assets over the
years as well as the sectorial investment of the fund since enactment of Pension Reform Act 2014. It was
observed that there was significant decline in the amount of contribution of the public sector prior to and
during the election year whereas the private sector recorded drop in the year after election. Likewise
observed an over concentration of investment asset in secured Government bonds. The pension
commission should continue to give adequate attention to enforcement of remittances and possibly met
sanctions as stipulated in the PRA 2014 as a deterrent to defaulting employers. It was recommended that
there should be regular spot checks by pension commission on prompt remittance by employers, in
compliance with the PRA 2014, and the broadening of risk assets of the fund.
Keywords: Contributory pension scheme, pension assets, pension commission, public sector, private
sector