PENSION REFORM ACT, 2004

Objective of the Act

The objectives of the Scheme shall be to:
(a) ensure that every person who worked in either the Public Service of the
Federation, Federal Capital Territory or Private Sector receives his
retirement benefits as and when due;
(b) assist improvident individuals by ensuring that they save in order to
cater for their livelihood during old age; and
(c) establish a uniform set of rules, regulations and standards for the
administration and payments of retirement benefits for the Public Service
of the Federation, Federal Capital Territory and the Private Sector.

Establishment of the Commission

There is established a body to be known as the National Pension Commission.
The Commission:
(a) shall be a body corporate with perpetual succession and a common seal;
and
(b) may sue and be sued in its corporate name.
The Commission may acquire, hold or dispose of any moveable or immoveable
property for the purpose of its function.

Objectives of the Commission

The principal object of the Commission shall be to regulate, supervise and ensure
the effective administration of pension matters in Nigeria.

Composition of the Commission

The Commission shall consist of:
(a) a part-time chairman who shall possess a university degree or its
equivalence with not less than 20 years experience;
(b) a Director-General who shall:
(i) be the Chief Executive Officer responsible for the day-to-day
administration of the Commission;
(ii) possess professional skill and with not less than twenty years
cognate experience relating to pension matters and or Insurance.
Actuarial Science or other related field; and
(iii) be a fit and proper person;
(c) four full-time Commissioners who shall each:
(i) possess professional and cognate experience in Finance and
Investment, or Accounting or Pension Management or Actuarial
Science or Business Administration or other related field; and
(ii) be fit and proper persons,
(d) part -time members of the Commission who shall be representatives
each of:
(i) The Head of the Civil Service of the Federation,
(ii) The Federal Ministry of Finance,
(iii) The Nigeria Labour Congress,
(iv) The Nigeria Union of Pensioners,
(v) The Nigeria Employers’ Consultative Association,
(vi) The Central Bank of Nigeria; and
(vii) the Securities and Exchange Commission.
There shall be 4 specialised departments of the Commission, namely:
(a) Technical;
(b) Administration;
(c) Inspectorate; and
(d) Finance and Investment to be headed by 4 Commissioners.
The Chairman, the Director-General and other members of the Commission
other than ex-officio members shall be appointed by the President, one each
from the six geo-political zones of Nigeria, subject to the confirmation of the
Senate.
The Commission’s Secretary and Legal Adviser shall be appointed by the
Commission and his terms of employment shall be as stipulated by the
Commission.
The Chairman, the Director-General and the Commissioners shall hold office
for a term of 4 years and may be re-appointed a further term of 4 years. In the
event of a vacancy, the President shall appoint a new member from the
appropriate zone to complete the tenure of his successor.

Functions and Powers of the Commission

The Commission shall:
(a) regulate and supervise the Scheme established under this Act;
(b) issue guidelines for the investment of pension funds;
(c) approve, licence, regulate and supervise pension fund administrators,
custodians and other institutions relating to pension matters as the
Commission may, from time to time, determine;
(d) establish standards, rules and guidelines for the management of the
pension funds under this Act;
(e) ensure the maintenance of a National Data Bank on all pension matters;
(f) carry out public awareness and education on the establishment and
management of the Scheme;
(g) promote capacity building and institutional strengthening of pension
fund administrators and custodians;
(h) receive and investigate complaints of impropriety levelled against any
pension fund administrator, custodian or employer or any of their staff
or agent; and
(i) perform such other duties which, in the opinion of the Commission, are
necessary or expedient for the discharge of its functions under this Act.
The Commission shall have the power to:
(a) formulate, direct and oversee, the overall policy on pension matters in
Nigeria;
(b) fix the terms and conditions of service including remuneration of the
employees of the Commission;
(c) request or call for information from any employer or pension
administrator or custodian or any other person or institution on matters
relating to retirement benefit;
(d) charge and collect such fees, levy or penalties, as may be specified by
the Commission;
(e) establish and acquire offices and other premises for the use of the
Commission in such locations as it may deem necessary, for the proper
performance of its functions under this Act;
(f) establish standards, rules and regulations for the management of the
pension funds under this Act;
(g) investigate any pension fund administrator, custodian or other party
involved in the management of pension funds;
(h) impose administrative sanctions or fines on erring employers or pension
fund administrators or custodians;
(i) order the transfer of management or custody, of all pension funds or
assets being managed by a pension fund administrator, or held by a
custodian whose licence has been revoked under this Act, or subject to
insolvency proceedings to another pension fund administrator or
custodian, as the case may be; and
(j) do such other things which in its opinion are necessary to ensure, the
efficient performance of the functions of the Commission under this Act.

Funds of the Commission

The Commission shall establish and maintain a fund from which all its expenses
will be defrayed. The fund established shall consist of:
(a) the initial take-off grant from the Federal Government;
(b) annual subvention from the Federal Government;
(c) fees, fines and commissions charged by the Commission;
(d) income from any investments of the Commission; and
(e) all sums of money or income accruing to the Commission by way of
testamentary dispositions and endowments.

Estimates, Accounts and Audit of the Commission

The Commission shall cause to be prepared, not later than the thirtieth day of
September in each year, an estimate of its income and of expenditure for the
succeeding year.
The Commission shall cause to be kept proper accounts and records in relation
thereto. Such account shall, not later than 4 months after the end of each year,
be audited by auditors appointed by the Commission from the list and in
accordance with the guidelines supplied by the Auditor-General for the
Federation.
The Commission shall not later than 6 months after the end of each year submit
to the President and the Public Account Committee of the National Assembly a
report on the activities and administration of the Commission during the
immediately preceding year and shall include in such report the audited
accounts of the Commission and the auditors report thereon.

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