How pension contributors can access funds before retirement – PENOP

How pension contributors can access funds before retirement – PENOP

Chuks Udo Okonta

Only dismissed employees can access 25 per cent of their pension benefits before retirement the Chairman Pension Operators Association of Nigeria (PENOP) Dave Uduanu, has said.

He told Inspen that contributors who resigned from their employment have to wait until they are 50 years before they can have access to the pension contribution, adding that employees should asked their employers to sack them whenever they are force to resign.

He said sacked employees can access 25 per cent of their contributions six months after they lose their jobs and are unable to secure another one.

He said: “In Nigeria when a company wants to sack somebody, he or she is asked to resign. When an employee resigns, he or she cannot get 25 per cent of the contribution. A lot of banks’ staff that were sacked, were asked to resign. Now, they cannot get 25 per cent of their benefits. It is important to let people know that their employer must sack them for them to get 25 per cent of their benefits. If your employer tells you to resign, tell him to sack you for it is better than forceful resignation.”

 He said no contributor can collect his or her benefit until time of retirement, unless the person is sacked, adding that new pension scheme has to do with Retirement Saving Account (RSA) and not a bank account which fund can be drawn at will.

“ What the regulator said is that if an employee losses his or her job – if you are sacked not when you voluntarily resigned, before age 50, six months after the employee losses the job and do not find another job, he or she can apply to collect 25 per cent of the balance on his or her account. But the Pension Fund Administrator (PFA) has to prove that the person was dismissed and that his or her company has remitted all the contributions. Otherwise, the employee has to wait until he or she is 50 years,” he said.