By David Akinmola
The National Pension Commission (PenCom) has issued a new directive warning all Licensed Pension Fund Operators (LPFOs), including Pension Fund Administrators (PFAs) and Pension Fund Custodians (PFCs), against transacting business with service providers who fail to remit pension contributions of their employees in the country.
In a directive circulated over the week, the commission stressed that it is unlawful and unethical for pension operators to engage with companies that are not compliant with the Contributory Pension Scheme (CPS).
The commission stated that such actions directly contravene the provisions of the Pension Reform Act 2014.
According to PenCom, pension operators must perform rigorous due diligence before entering into business relationships with vendors, contractors, or partners, ensuring they fully comply with pension remittance requirements.
Speaking on the development over the weekend, an expert in the industry, Adegbero Ogunyelu, welcomed the move, describing it as timely and necessary.
For him, the directive would compel employers to take their pension responsibilities more seriously.
However, this is a bold and commendable step by PenCom. By cutting off access to contracts and business opportunities, defaulting employers will now have real incentives to comply with pension law, he noted.
A pension consultant, Sunday Aderibole, who also commented on the development, supports the directive. Saying the move will strengthen the integrity of the pension system in the country and protect the future of Nigerian workers. We will be revising our vendor engagement policies to reiterate this guideline.
PenCom has reiterated that it remains committed to protecting the interests of Retirement Savings Account (RSA) holders and ensuring full compliance within the industry.
It also warned that any operators found violating the directive would face regulatory sanctions, including fines and possible license suspension.
The commission advised members of the public and employees to report any employer failing to remit pension contributions via its official website or whistleblower channels.
