I have been taken on severally on my stand on contributory Pension in Katsina by some of my friends and other people, mostly civil servants. The most recent is sequel to my piece AFTERMATH OF THE STRIKE….where I urged the labour Union to cause the introduction of contributory pension scheme in the state. Their opinion mostly is why I should be canvassing for this scheme when it is not going to be practicable in a state like Katsina.
Now, here is the thing…since my exit from the state service in the late eighties I have been engaged in Pension business and have come to terms with the fact that it is only the contributory pension scheme that can provide answer to the perennial imbroglio that has bedeviled the Pension industry.
What is this contributory pension scheme anyway? This scheme entails that each individual/ worker has his own saving account (RSA) where he contributes monthly towards his retirement and the money is kept by his chosen Pension Fund Administrator. The scheme is fully funded by both the worker and the Government so that at any given time that particular account is kept buoyant.
Traditionally speaking, the idea of saving is as long as history can remember. People do save now to enable them use whatever is saved in the future. That is the use of ASUSU, a small container with a small perforation in it that is used to put coins and other legal tender in it to enable the owner saves for future use. ADASHE is another form of saving, where a specified number of people mutually agree to contribute certain amount of money, monthly, weekly or even daily for only one of them to collect in a particular instance. All these forms of saving are still relevant in present day dealings. I can still remember when I was young, Asusu was always in vogue as children of my age were very fond of it, especially when there was going to be any occasion, like Sallah celebration or any festivities we used to save money in it to enable us buy things of our interest. Adashe is a much more elaborate operation as it involves bigger equity and interest. Many civil servants still do engage in it, especially when one has a certain plan to execute but does not have the capacity. Like when one wants to marry or buy a new car or wants to change to a bigger car he can always get himself involved in adashe and solve his problem without any qualms. This is saving now for future use and that is all what the contributory pension scheme is all about. Saving for the rainy day. When you can no longer work or when you are incapacitated .The paradigm is now towards somebody saving money for his pension entitlements not working for his entitlements. That popular phrase in our appointment letters…Permanent and Pensionable...will very soon be expunged and be replaced with …You are required to open a retirement saving account….
The World Bank came out with its landmark report titled ‘Averting the old age crises’ in it, the Bank advocated a move from the pay- as- you- go financing of pension. The report backed where possible, a much bigger role of earning in retiring account. Since the report came out, reforms along these lines have been carried out mainly in Latin America, Europe and Central Asia. Nigeria’s Pension Reform Act 2004 is also in line with this change. Hitherto, the Pension reform act, the defunct Obasanjo administration groaned under a N3 trillion pension arrears and that compelled it to send an executive bill to NASS as its own answer to averting the crisis in the Industry. The consequence of that singular action led to the enactment of the law that mandates each and every worker in the private sector, Federal service and the FCT to contribute for his retirement 7.5% of his/ her gross salary and his employer contributes the same amount monthly on his behalf and the total sum is kept for him by his chosen PFA in a RSA. It is interesting to note that about 14 states in the Federation have adopted the legislation. The scheme is fully funded through the monthly contribution of both the employer and employee. So, upon retirement the beneficiary collects his gratuity and is immediately placed on monthly pension because the funds are readily available, unlike the old pension scheme like the one we are operating in Katsina State, there would not be any ready funds to pay the pensioners. These Public pension schemes are not designed to deliver current benefits level when confronted with today’s major demographic and economic changes and to keep them afloat will drastically affect public spending on Health, Agriculture and Education to mention but a few.
For any pension scheme, whether public or private to be successful it has to be fully funded to the extent that the pension funds and assets match pension liabilities at any given time. In our own case, we know the liabilities but we don’t know if the fund is available, as we have to wait for the Federal grants to come. So no grant, no pension!!! But shifting to the privately managed plans that are fully funded and that tie benefits to contributions are more likely to improve economic growth, provide better benefits and more importantly, is you collect your entitlements as and when due than will continued reliance on Pay- as – you- go system.
It is therefore important for my friends and indeed all civil servants to come to terms with the reality that retirement from service is an inevitable end and when it happens there will be no more salary, no AIE, no MFA, not even egunje but your pension entitlements and as long as these funds are not readily available, the Government will just be owing- one month pension, five months, thirty months pension sometimes the number can even be more but if you are one of the doubting thomases and thinks it cannot happen in Katsina State you better think again or better still ask former workers of the Nigerian Railway corporation, New Nigerian Newspapers, just to mention but a few.
Tuesday, October 25, 2011
AFTERMATH OF THE STRIKE….
I was just coming out of Masallachin Kerau after the Zuhr Prayers when I noticed one of my friends standing by the nim tree beside the mosque. I walked towards him to inquire why he was standing there and said that he noticed me in the front row in the course of the prayer and decided to wait and greet me since it has been long when we last met. I run short of words to explain to him why I was not at our Old boy’s meeting which took place during the Sallah break. I managed to concoct some flimsy excuses which I knew he would not accept but I just had to say something…
It is a very hot afternoon, he said to me, using a face towel to wipe up a clot of sweet that crawls from his forehead down to his right cheek. Indeed, it is, I replied. As we walked towards my car his phone rang grddrrhgrrddhmg, grddrrhgrrddhmg, honestly I never heard such an unpleasant ring tone, and in fact I was even frightened as I couldn’t fathom from where the noise was coming from before I realized it was my friend’s phone. It was this kind of fake nokia products or something... Don’t mind my phone it is this Chinese product he said in recognition to my disappointment. ‘Sai dai ki yi da abinda ya sauwaka’ he answered. It was after he was done with the phone he told me that it was his wife. She called on him to inquire if he was going to bring home ‘chefane’ for the evening meal.
You see Isa; this protracted strike is taking its toll on almost all the citizenry of this state. My wife is pestering me to bring something for the evening meal; meanwhile I have not even taken anything for lunch. I trekked nearly 3 to 4 kilometers today but without anything to show for it, my car is out of gas, my younger child is a sickler and has not taken his medication for the last two days and to cap it all, I don’t have a dime at home or in the bank, am frustrated, am disappointed and am confused he concluded. I felt sorry for him and for any other person who is in that position, especially, when I knew I could not be of any significant help to him. My only best to him was N5, 000 but how long would that take him? What would happen tomorrow or next? Or, would that be the case of fold your arms and wait for the Lord to remember you? I picked up courage to console him and offered him my widow’s might knowing full well that would not take him up to two days with all those myriad of problems. By the way my friend is on grade level16, a senior Director in one of the ministries.
I drove my car without having a slightest idea of where I was going, wondering in consternation. This is a very senior officer who had graduated from the university 3 decades ago, what is happening to my state? Providing the answer to myself almost immediately- Purposeful leadership.
Unfortunately the present leadership in the state is either unable or unwilling to draw up a congenial roadmap that will make our state government to accept that the paradigm shift for economic development in this 21st century has tilted towards creation of wealth from distribution. Unfortunately, the constitution has not help matters as it bestows all national resources in the hands of the President and the State Governors. This makes them so powerful and so influential that they treat their subjects as if they are a conquered people. It is like a PG show: they decide who gets what; and who does not get what. What to say and what not to say…this disconnect between the belief that national wealth in meant to be distributed anyhow and not as a source of providing economic and social enterprises is the bane of our problems and the result is what we are witnessing now: underdevelopment, poverty, crimes, suicides…in the last couple of months we have recorded about 2 or 3 suicide cases and all were civil servants.
The strike has really exposed our vulnerability, the civil servants, the market women, the whole state; every one of us, that none of us can do without the Government and equally, the Government cannot do without Federal allocations that it collects effortless from the Federation accounts. So in order for us, as a people, as a government to get out of this quagmire we need to do something urgently and we need to do it now, if only we want to be judged positively by posterity.
The government on its side has to be purposeful, sincere, open, transparent and accommodating. The present disposition of the government where its activities are run on one man show basis or a government that is run off-head is not acceptable. There has to be coordinated synergy between the government and its people, a dialogue on what it intends to do. For example, the Free Education. I think there is a lot of misgiving about the program. The program is just about the payment of school and examination fees, there has to be much more than that… You must provide conducive atmosphere for learning to take place, a situation where you have over100 students in a class is not acceptable, you must recruit quality teachers for all subjects; you must provide instructional materials and other teaching aids and more importantly, you must engage all the stake holders that have anything to do with education such as Teachers, parents, education administrators, private and students, discuss with them frankly and tell them that Government cannot shoulder the responsibility 100%. Their reaction will now give you impetuses that will enable you drive the sector to greater height. Otherwise, I see a bleak future as far as education is concerned in Katsina state.
The idea that the Government is going to embark on staff audit should be hailed and be given the necessary support; we should be ready to report anybody we feel is a ghost worker. Civil servants who do not merit to be called civil servants should be shown the way out. We can now boost of several young and enterprising graduates who are unemployed and are ready to put in their best for the progress of the state and can always fill in the vacuum left by any undesirable civil servant if only they are given the chance.
Labour on its side must be up and doing in its activities, it must be ready to accept responsibility and accept the consequence of any action. It can demand and get N52,000.00 as initially demanded by the national body as a minimum wage but as long as it is not doing what it is suppose to do, the money will just go under: easy come, easy go, they say.
Now, that labour has gotten what they demanded, we would like to see changes, changes in attitude, in approach, in the way they dress as civil servants, changes in the way they perform their duties, a total reinvention of all its activities. A situation where civil servants work less than 50% of their capacity will surely not be tolerated. You are expected to be in the office 8.00am and close by 3.30pm and anything short of that will not be tolerated, these timings should be made sacrosanct. A timer should be made available in all offices so that workers should be mandated to clock in as they come in the morning and clock out when the office closes, in this way, workers who are not serious could be easily identified.
Now, back to my friend who stir up this piece, he is about 59 and he is on the verge of retirement from work. Retirement being a phenomenon which no worker/civil servant wants but is inevitable. It has to come or happen on any employee. Just like it is going to happen to my friend in less than one year or so and my fear for him and any other person who is in the same shoes is: how would he cope up when he retires? Knowing full well that he has not saved anything, and he has no trade to fall back, the only succor is his retirement benefits.
Minimum wage is a great concern but a greater concern is the issue of Pension, which as far as am concerned is a time bomb. So long as our governments will be absolutely dependent on monthly subventions from the Federation accounts for our survival, the time for the bomb to explode is surely within a twinkle of an eye. That is why, I want to plead with the Labour and the Government in Katsina state to start the contributory pension now without any delay as the Federal Government, the FCT and some few states in the federation have already started. Kaduna, Kano, Zamfara inclusive. So that when my friend finally retires nobody will deny him his residues because some kind of Federal allocation has not come from the Federation account. That will also enable him buy a new original Nokia Phone, engage his younger child on full medication every day, have his car full to capacity with gas, and give Madam enough money for ‘Chefane’.
It is a very hot afternoon, he said to me, using a face towel to wipe up a clot of sweet that crawls from his forehead down to his right cheek. Indeed, it is, I replied. As we walked towards my car his phone rang grddrrhgrrddhmg, grddrrhgrrddhmg, honestly I never heard such an unpleasant ring tone, and in fact I was even frightened as I couldn’t fathom from where the noise was coming from before I realized it was my friend’s phone. It was this kind of fake nokia products or something... Don’t mind my phone it is this Chinese product he said in recognition to my disappointment. ‘Sai dai ki yi da abinda ya sauwaka’ he answered. It was after he was done with the phone he told me that it was his wife. She called on him to inquire if he was going to bring home ‘chefane’ for the evening meal.
You see Isa; this protracted strike is taking its toll on almost all the citizenry of this state. My wife is pestering me to bring something for the evening meal; meanwhile I have not even taken anything for lunch. I trekked nearly 3 to 4 kilometers today but without anything to show for it, my car is out of gas, my younger child is a sickler and has not taken his medication for the last two days and to cap it all, I don’t have a dime at home or in the bank, am frustrated, am disappointed and am confused he concluded. I felt sorry for him and for any other person who is in that position, especially, when I knew I could not be of any significant help to him. My only best to him was N5, 000 but how long would that take him? What would happen tomorrow or next? Or, would that be the case of fold your arms and wait for the Lord to remember you? I picked up courage to console him and offered him my widow’s might knowing full well that would not take him up to two days with all those myriad of problems. By the way my friend is on grade level16, a senior Director in one of the ministries.
I drove my car without having a slightest idea of where I was going, wondering in consternation. This is a very senior officer who had graduated from the university 3 decades ago, what is happening to my state? Providing the answer to myself almost immediately- Purposeful leadership.
Unfortunately the present leadership in the state is either unable or unwilling to draw up a congenial roadmap that will make our state government to accept that the paradigm shift for economic development in this 21st century has tilted towards creation of wealth from distribution. Unfortunately, the constitution has not help matters as it bestows all national resources in the hands of the President and the State Governors. This makes them so powerful and so influential that they treat their subjects as if they are a conquered people. It is like a PG show: they decide who gets what; and who does not get what. What to say and what not to say…this disconnect between the belief that national wealth in meant to be distributed anyhow and not as a source of providing economic and social enterprises is the bane of our problems and the result is what we are witnessing now: underdevelopment, poverty, crimes, suicides…in the last couple of months we have recorded about 2 or 3 suicide cases and all were civil servants.
The strike has really exposed our vulnerability, the civil servants, the market women, the whole state; every one of us, that none of us can do without the Government and equally, the Government cannot do without Federal allocations that it collects effortless from the Federation accounts. So in order for us, as a people, as a government to get out of this quagmire we need to do something urgently and we need to do it now, if only we want to be judged positively by posterity.
The government on its side has to be purposeful, sincere, open, transparent and accommodating. The present disposition of the government where its activities are run on one man show basis or a government that is run off-head is not acceptable. There has to be coordinated synergy between the government and its people, a dialogue on what it intends to do. For example, the Free Education. I think there is a lot of misgiving about the program. The program is just about the payment of school and examination fees, there has to be much more than that… You must provide conducive atmosphere for learning to take place, a situation where you have over100 students in a class is not acceptable, you must recruit quality teachers for all subjects; you must provide instructional materials and other teaching aids and more importantly, you must engage all the stake holders that have anything to do with education such as Teachers, parents, education administrators, private and students, discuss with them frankly and tell them that Government cannot shoulder the responsibility 100%. Their reaction will now give you impetuses that will enable you drive the sector to greater height. Otherwise, I see a bleak future as far as education is concerned in Katsina state.
The idea that the Government is going to embark on staff audit should be hailed and be given the necessary support; we should be ready to report anybody we feel is a ghost worker. Civil servants who do not merit to be called civil servants should be shown the way out. We can now boost of several young and enterprising graduates who are unemployed and are ready to put in their best for the progress of the state and can always fill in the vacuum left by any undesirable civil servant if only they are given the chance.
Labour on its side must be up and doing in its activities, it must be ready to accept responsibility and accept the consequence of any action. It can demand and get N52,000.00 as initially demanded by the national body as a minimum wage but as long as it is not doing what it is suppose to do, the money will just go under: easy come, easy go, they say.
Now, that labour has gotten what they demanded, we would like to see changes, changes in attitude, in approach, in the way they dress as civil servants, changes in the way they perform their duties, a total reinvention of all its activities. A situation where civil servants work less than 50% of their capacity will surely not be tolerated. You are expected to be in the office 8.00am and close by 3.30pm and anything short of that will not be tolerated, these timings should be made sacrosanct. A timer should be made available in all offices so that workers should be mandated to clock in as they come in the morning and clock out when the office closes, in this way, workers who are not serious could be easily identified.
Now, back to my friend who stir up this piece, he is about 59 and he is on the verge of retirement from work. Retirement being a phenomenon which no worker/civil servant wants but is inevitable. It has to come or happen on any employee. Just like it is going to happen to my friend in less than one year or so and my fear for him and any other person who is in the same shoes is: how would he cope up when he retires? Knowing full well that he has not saved anything, and he has no trade to fall back, the only succor is his retirement benefits.
Minimum wage is a great concern but a greater concern is the issue of Pension, which as far as am concerned is a time bomb. So long as our governments will be absolutely dependent on monthly subventions from the Federation accounts for our survival, the time for the bomb to explode is surely within a twinkle of an eye. That is why, I want to plead with the Labour and the Government in Katsina state to start the contributory pension now without any delay as the Federal Government, the FCT and some few states in the federation have already started. Kaduna, Kano, Zamfara inclusive. So that when my friend finally retires nobody will deny him his residues because some kind of Federal allocation has not come from the Federation account. That will also enable him buy a new original Nokia Phone, engage his younger child on full medication every day, have his car full to capacity with gas, and give Madam enough money for ‘Chefane’.
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