Ebere Nwoji<\/p>\n
Actuarial Scientist and Chairman Chief Executive officer of Anchor Actuarial Services, Dr Pius Apere, has said that recent proposal by the Director General National Pension Commission(PenCom), Ms Omolola Oloworaran, to introduce gratuity benefits for public servants under the \u00a0Contributory Pension Scheme (CPS)\u00a0must be backed by law.<\/p>\n
This, according to him, means that the initiative would require an amendment to the PRA 2014, particularly Section 7(1) (a) of the Act to avoid duplication of payment of lump sum benefits.\u00a0<\/p>\n
Apere \u00a0disclosed this in a recent statement titled rationale behind retirement \u00a0benefits for CPS under PRA 2014.<\/p>\n
He recalled that during a meeting held in June 2025, between the \u00a0PenCom DG and Head of the Civil Service of the Federation (HCSF), the PenCom boss had muted the idea of paying workers gratuity under the CPS.<\/p>\n
He said this cannot just be done without recourse to the law establishing CPS.<\/p>\n
\u201cAny decision to reinstate gratuity scheme into the CPS must be backed by law, which will require an amendment to the PRA 2014, particularly Section 7(1) (a) of the Act to avoid duplication of payment of lump sum benefits. In the same vein, state governments are likely to introduce similar gratuity schemes for the state public servants. The only possible constraint will be the Federal and state governments\u2019 ability to fund their gratuity liabilities including the cost of actuarial valuation whether as standalone scheme or embedded in CPS,\u201d he said.\u00a0<\/p>\n
According to him, the latter scenario will result in a Hybrid \u201cMiddle-way\u201d scheme in operation \u2013 a scheme which offers both defined benefit (GS) and defined contribution (CPS) sections.<\/p>\n
He however noted that the review of the retirement benefits for CPS under PRA 2014 was a welcome development and commendable initiative to improve the retirees\u2019 welfare.<\/p>\n
Apere noted that those who framed the CPS law , the PRA 2004 (as amended), did not consider the importance of pension increases when designing the two pension products in the CPS, namely Programmed Withdrawal (PW) and Retiree Life Annuity (RLA), to provide retirement benefits for the Retirement Savings Account (RSA) holders at retirement. He said in alternative, the framers made provision for Guaranteed Minimum Pension (GMP) in section 84(1) of PRA 2014 to protect the RSA holders against some of the risks of low investment returns and the erosion of pensioners\u2019 incomes by inflation.\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"Ebere Nwoji Actuarial Scientist and Chairman Chief Executive officer of Anchor Actuarial Services, Dr Pius Apere, has said…\n","protected":false},"author":2,"featured_media":15669,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[64,63,99,186,184,185],"class_list":{"0":"post-15668","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-au","9":"tag-australia","10":"tag-business","11":"tag-finance","12":"tag-personal-finance","13":"tag-personalfinance"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/15668","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=15668"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/15668\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/15669"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=15668"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=15668"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=15668"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}