Police Pension bill retrogressive, unsustainable- PenOp
Pension Fund Operators Association of Nigeria (PenOp) has kicked against the Bill seeking to create a Police Pension Board.
The Chief Executive Officer of PenOp Ogwuche Aguda described the Bill as retrogressive and unsustainable.
Aguda in a statement said there is clear visibility into the amount of retirement benefits disbursed by all the PFAs.
He said the withdrawal of the police from the Contributory Pension Scheme (CPS) would require a backward shift to the Defined Benefits Scheme (DBS).
According to him, “in contrast to other pension schemes operated in the past, any framework outside what is being operated lacks transparency as the police are pushing back to this non transparent system.
“This again will lead to the dismantling of the institutions, systems, and processes that the government has established to manage pensions effectively as 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 provisions for through a private sector managed pension scheme”.
The PenOp CEO cautioned that “unwinding investments destabilizes the financial system, diminishes assets, and jeopardizes the retirees themselves. Moreover, it disrupts fiscal policy and creates an unstable financial system.”
He therefore noted that 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 stand-alone pension management system as the police is advocating will not benefit from this pooling effect.
