PENCOM’s mandate is to ensure that lives of pensioners and those contributing to the Micro Pension Plan (MPP) are comfortable after retirement from service.
The platform provides workers in this sector, the opportunity to easily register and contribute in a flexible manner and in a safe and secure environment for their pension at retirement.
The National Pension Commission (PenCom) in their report, also revealed plans to intensify financial self-sufficiency for Micro Pension Plan (MPP) subscribers as the number of contributors recently increased to well over 87,000.
This also suggests that the level of awareness of the scheme among artisans, entrepreneurs and participants in the informal sector has increased in the last few months. The scheme is to encourage participants in the sector, which forms a large percentage of the working population, to save for their retirement.
Speaking to newsmen at one of his sensitization trips in the south – south, the Hon. Commissioner for Finance at PenCom, Dr. Charles Sylvester Emukowhate,, said the institution’s objective is to ensure those in the informal sector and other organizations with less than three employees, are fully captured in the scheme.
He noted that PenCom was desirous to ensure Nigerians in the informal sector enroll and register in the plan, adding that it had started sensitisation of the plan to communities, market places, public gatherings, government institutions, associations and trade fair grounds across the country. He further explained that, the Micro Pension Plan (MPP) has always been flexible, safe and convenient for participants in the informal sector.
Pursuant to its statutory mandate, he disclosed that the commission has effectively regulated and ensured safety of pension assets and fair returns on investments, utilizing appropriate technology with highly skilled and motivated staff.
In conclusion, Dr Charles said “The contributors, within this scheme in the informal sector, can draw out 40 per cent of what they have saved for emergency demand; while the remaining 60 per cent would remain and await for the retirement plan proper.
The informal sector in Nigeria constitutes the vast majority of the working population in the Country (approximately between 70%-90%). However, this category of workers have no pension protection with the risk of old age poverty. Therefore, the Pension Reform Act (PRA) 2014 expanded coverage of the Contributory Pension Scheme to the informal sector through the Micro Pension Plan (MPP).
The MPP is a voluntary pension plan for informal sector workers such as traders, members of unions and associations, artisans, stylists and employees in organizations with less than three (3) workers. The MPP is flexible in terms of registration and remittance of contributions. Furthermore, the MPP is regulated by the National Pension Commission to ensure the safety of the pension assets.
The MPP helps participants cultivate the habit of saving for their old age while they are active to provide a regular stream of income. This would enable them secure financial autonomy and independence in their old age. The MPP also provides the participant access to health insurance cover and other incentives.
The operational modalities of the MPP regarding eligibility of participation, registration, remittance of Contributions and withdrawal options are presented on the next page in the info graphics.
