The National Pension Commission (PenCom) is set to collaborate with the Office of the Head of the Civil Service of the Federation (OHCSF) to introduce gratuity.

In a statement released on Tuesday in Abuja, PenCom stated that the framework was for civil servants in treasury-funded ministries, departments, and agencies (MDAs) under the Contributory Pension Scheme (CPS).

The director-general of PenCom, Omolola Oloworaran, said this when she visited the Head of the Civil Service of the Federation (HCSF).

According to Ms Oloworaran, the gratuity scheme will be established in line with section 4(4)(a) of the Pension Reform Act (PRA 2014) for retiring employees of federal government treasury-funded MDAs.

She said it was estimated to cost the government about N30 billion per annum, as determined by PenCom and confirmed by the 2024 stakeholders committee on outstanding pension liabilities.

Ms Oloworaran said the amount represented a modest but impactful intervention to improve the welfare of those who had served the nation with dedication.

According to her, the persistent issue of delayed payments is due to the delay in payment of accrued rights.

The DG said the previous collaboration between PenCom and the OHCSF yielded significant progress.

She said this includes securing a Federal Executive Council (FEC) approval for the N758 billion bond to clear outstanding pension liabilities under the CPS.

Ms Oloworaran also unveiled a one-time, comprehensive online enrolment exercise to establish the accrued pension rights liability of all serving federal employees of treasury-funded MDAs who were in service before June 2004.

She said this online verification and enrolment exercise would begin in August.

The DG said it would enable PenCom to present to the government the amount so determined to possibly raise a bond to settle the entire liability once and for all.

Ms Oloworaran said the determined accrued pension rights for every eligible civil servant would be credited into their individual Retirement Savings Accounts (RSAs).

She said one of the benefits is that retirees would start earning returns on these funds, and the system would become shielded from political transition as Pension Fund Administrators (PFAs) would take full control.

Ms Oloworaran said the commission was developing a digital application to streamline the enrolment process.

She said PenCom plans to deploy the online application by August and sought OHCSF’s support to issue a circular directing all MDAs to participate in the enrollment and submit the necessary documentation.

Ms Oloworaran said to address the challenge of uncredited pension contributions among MDAs not enrolled in the Integrated Payroll and Personnel Information System (IPPIS), some contributions were often made without accompanying schedules.

According to her, contributions are often made without accompanying schedules.

Ms Oloworaran said PenCom had introduced a new pension contribution remittance system that requires all employers to, henceforth, utilise selected Payment Solution Support Providers (PSSPs) for the remittance of their employees’ contributions.

She said this ensures accurate and prompt remittance of pension contributions into the respective RSAs of employees.

The DG also requested the head of service’s assistance in issuing directives to the IPPIS office in the Office of the Accountant-General of the Federation (OAGF) and MDAs not on IPPIS, such as tertiary institutions, self-funding agencies, and others, to utilise selected PSSPs for remittance of monthly contributions effective June.

The head of HCSF, Didi Walson-Jack, expressed her support for all the initiatives and commended PenCom for its proactive approach to improving pension administration.

She pledged to issue the necessary circulars to MDAs and to collaborate closely with PenCom in developing the modalities and securing the approvals for the gratuity scheme.

Ms Walson-Jack said civil servants have been calling for gratuity and expressed her full backing for the proposed gratuity scheme.

According to the statement, PenCom and OHCSF agreed to establish a standing committee to work on the outlined reforms and address any emerging issues in the future.

(NAN)