PenCom approves N5.33bn for payment to RSA holders

The National Pension Commission (PenCom) declared that it has approved N5.33 billion to enable PFAs to provide succour to 11,796 account holders who found themselves out of jobs.

The PenCom disclosed that similar approval was granted for the payment of N4.31 billion to 8,221 RSA holders who were under the age of 50 years and were disengaged from work but unable to secure another job within four months of disengagement in the first quarter of the same year.

Available data has shown that Nigeria’s unemployment rate as at the second quarter of 2020 was 27.1 percent, indicating that about 21,764,614 (21.7 million) Nigerians remained unemployed.

Head, Corporate Communications, PenCom, Peter Aghahowa, had said workers who lost their jobs owing to the pandemic would be able to get a quarter of the savings in their Retirement Savings Accounts (RSAs) to cushion their hardship after four months of job loss.

Aghahowa said:  “The contributory pension was designed to allow access to 25 per cent of retirement savings balance in a situation whereby you lose your job. So if you lose your job, after four months you can access 25 per cent of your RSA contribution.”

According to the provisions of Section 7(1) of the Pension Reform Act (PRA) 2014, retirees are given two retirement benefit modes – Programmed Withdrawal (PW) and Retiree Life Annuity (RLA), which they are required to choose from payments.

The PW is an income paid by a PFA to a retiree monthly or quarterly while, RLA is a stream of income purchased from a life insurance company with the RSA balance under the CPS as a premium.

And of course, the RLA regulations are issued by the PenCom and the National Insurance Commission (NAICOM).