NPRA to name and shame defaulting tier-2 pension institutions

The National Pensions Regulatory Authority (NPRA) has said it is going to embark on a rigorous exercise to clamp down on institutions which don’t contribute to the tier-two pension schemes for workers.

According to NPRA, as part of the exercise it will name, shame, and prosecute defaulting companies.

“We will also make unsolicited visits to most institutions to examine the records of their employees; and if they are not contributing within a stipulated time, more time will be given for their employers to do so – failure of which will be sanctioned by the law,” Northern Regional Zonal Manager of the NPRA, Yakubu Alhassan Fuseini, told the B&FT.

The authority said the move is necessitated by widespread reports that casual workers in the health, education, security, hospitality, and agriculture sectors have been ignored by their employers regarding payment of the tier-two pension scheme.

“When someone fails to contribute for his or her workers, it is against the laws of the country; because the law says after six months one is entitled to the benefits – which many organisations have been ignoring.”

He bemoaned the destitute state of some retirees, owing mainly to companies’ failure to pay their pensions.

Mr. Fuseini further stressed the need for stronger policies that will force the private sector to comply with the country’s pension laws, so that contributions of their employees are paid to the corporate trustees to secure their future.

He said the NPRA will continue to educate the public about the importance of pensions, as lack of knowledge about it is partly to blame for the suffering they go through after retirement.

“Because most of them do not understand the scheme’s benefits, they feel reluctant to contribute to it – which affects their retirement income at old age,” he added.

He encouraged participation in the tier-3 pension scheme, especially the personal pension scheme.

The NPRA was established by the National Pensions Act, 2008 (Act 766), with the objective of regulating and monitoring operations of the Pension Schemes and ensuring effective administration of pensions in the country.