Lagos state government has assured pensioners that it would clear all outstanding accrued pension rights by 2021 even as it paid over N1.88 billion to 466 retirees as pensions benefits.
The Director-General, Lagos State Pension Commision (LASPEC) Mrs. Folashade Onanuga, disclosed this at the 72nd Batch Retirement Benefit Bond Certificate Presentation in Lagos, stated that the feat will be achieved through the solid structures that have been put in place by the state government.
Onanuga stated that the mandate will be possible because the state government had currently increased the funding rate of the redemption funding account from which the accrued right is paid, from five to 10 per cent.
She explained that the government had also approved a budget of N13 billion and a pension sinking fund in addition to the monthly increase.
“We are sure that by 2021 all outstanding backlog will have been cleared. We have a lot of fund flowing in to enable us make these payments and that is why in the last few months , we have paid about N 2 billion monthly on the retirement bond.
“With this trend,we are very sure that by 2021 , we won’t have any outstanding backlog ” she said.
According to her, the backlog currently being paid is for retirees before April 2007 when the state transmitted to the PFA’s. She added that any worker who had joined the Lagos State service after April 2007 and is retiring immediately transmits to become a pensioners because his or her funds are already being deposited in the Retirement Savings Account (RSA).
“The accrued rights , which is the one we are having a challenge with is what we are taking a bold step to resolve”.
She further explained that the accrued pension was huge because there were years in the past when the government embarked on mass recruitment and the employees in those set will retire at the same time after 35 years.
She said the government will however need a lot of fund to pay for the benefit of those set unlike the scenario where the recruitment was not very huge.
“With what we have in place ,we have taken into consideration what we need to pay the beneficiaries till 2022 and by 2021 ,we are sure that even before workers retires their pension rights will already be in their RSA’s,” she said.