The National Pension Commission (Pencom) disclosed that unfunded Retirement Savings Accounts (RSAs) raised major regulatory concerns in 2020.
This was disclosed in its quarterly report titled, ‘Update on the on-site analysis of pension fund operators’.
It added that in the third quarter of 2020 there was “substantial compliance” with existing guidelines and regulations by the commission.
One of the regulations by the commission involved ensuring that Pension Fund Administrators (PFAs) remitted contributions and are “credited into the RSAs of beneficiaries”.
It also directed PFAs to talk with employers to ensure up-to-date funding of contributors’ RSAs.
It stated, “The review of the operators’ activities during the third quarter of 2020 indicated substantial compliance with the extant laws and regulations issued by the commission.
“The key area of regulatory concerns were the rise in unfunded RSAs.
“The PFAs were directed to ensure all remitted contributions are credited into the RSAs of the beneficiaries and also liaise with the respective employers to ensure up-to-date funding of the contributors’ RSAs.”
It disclosed that the pandemic caused the commission to halt the 2020 on-site examination of pension fund operators.
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The examination, according to the commission, was carried out through monthly reports from operators.
It added that operators stated that their inability to efficiently clear excess contributions was due to the lean workforce spurred by the stay-at-home order in 2020.
Although, the commission instructed that all unreconciled pension contributions be sent to individual contributors’ RSA.
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