President Muhammadu Buhari, yesterday in Abuja, launched the Micro Pension Plan (MPP), where he personally registered Sagir Shawa, a Keke NAPEP operator in Karu area of Abuja.
This was even as he reiterated the commitment of his administration to address all pension issues inherited from previous administrations.
The MPP, an initiative of the National Pension Commission (PenCom), aimed at providing pension services to self-employed persons in the informal sector and employees of organisations with less than three staff is expected to mobilise about N3 trillion savings from the informal sector into the N8.6 trillion pension assets of the country.
Buhari explained that the initiative aims to capture those not fully covered in the pension scheme. He said, “In the past, we provided loans to farmers; the MPP is the natural next step.”
He urged trade associations, Non-Governmental Organisations (NGOs) in the informal sector to join hands with the government in enlightening their members to embrace the scheme.
Speaking at the formal launch of MPP, acting Director General, PenCom, Aisha Dahir-Umar, explained that the micro pension launch was part of an initiative to bring financial inclusion to all working Nigerians.
She noted that the informal sector constitutes an estimated 69 million workforce in the country and represents an estimated 88 per cent of Nigerian workers that lack pensions and safety nets for their old age.
Dahir-Umar said the goal of the Commission was to achieve coverage of 30 million people in the informal sector by 2024. She said from 2004 to date, the nation’s pension scheme has impacted Nigeria’s economy with assets currently worth over N8.74 trillion.
According to her, “the formation of long term domestic capital, represented by the over N8.74 trillion worth of pension assets as at January 2019, belonging to 8.46 million formal sector participants, is slowly but surely changing Nigeria’s financial landscape. This, by extension, is also transforming the course and pace of our socio-economic development. For instance, N6.51 trillion, representing 73 per cent of the total pension assets is invested in Federal Government securities issued to finance various activities of government.
“Thus, in the area of infrastructure alone, the pension funds invested about N95.31 billion in the N200 billion Sukuk issued by the Federal Government. Similarly, out of the N10.67 billion Green Bond issued by the Federal Government, pension funds invested N7.19 billion.
Consequently, we believe that the enlistment of the informal sector into the pension savings net would boost the quantum of available long term investible funds that would galvanise national development efforts.”
Dahir-Umar described the scheme as a unique financial product, which democratises the savings culture in Nigeria in a systematic and efficient manner.
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