FOLLOWING calls from some quarters that the growing pension funds be invested in the nation’s decayed infrastructure, the Minister of Finance, Mrs. Kemi Adeosun, has called for understanding, saying it would not be indiscriminately invested outside the law.
She said the federal government was being cautious over plans to invest the funds that have grown over the years. “A lot has been said about the pension money. We have N6 trillion and people treat it as if it is just available for the taking. This is people’s future savings, so we have to be very cautious about how we release pension money into investment. The first thing we have to do is to relax the rules cautiously and with many safeguards so we don’t lose pensioners’ money and cause a problem in the future.
“Definitely, we are going to put things in place such as the infrastructure bond that we are releasing that will encourage pension funds to invest but invest safely,” the minister said.
Director-General, National Pension Commission, PenCom, Mrs. Chinelo Anohu-Amazu, had, overtime, informed the public that the safety of the fund had been made possible because of the manner its investment was structured. According to her, the operation of Pension Fund Administrators, PFAs, is not part of the pension fund.
PFAs are totally separated and the reason is for safety of the fund. The other safety valve is that they are the ones managing the funds, but do not hold it. It is the Pension Fund Custodians, PFCs, that keep the funds.
“What we see, not very regularly I must say, maybe sometimes, some PFAs have some pressures and if they invest in something that is outside the investment guidelines, the next day they get a letter from the National Pension Commission.
“The PFC first of all would be queried, because it is outside the guidelines. And not only is the transaction rescinded, they pay a penalty and if there is any loss in interest in the Retirement Savings Account, RSA, they pay it. That is why it is a highly regulated business. It is either you are able to operate or not. So the issue of, ‘are the funds going somewhere’ or ‘where does the money go’ is no issue at all.”
She pointed out that infrastructure is already an asset class within the guidelines, saying the noise about incursion into the fund for infrastructure is funny. “Now the uptake is minimal and why is it so. It is so because you have not met the requirement for the pension funds to go into infrastructure,” she noted.

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