Contributors receive N208b as unemployment benefits in six months


• Fund exposure to FG securities now N9.64tr
Out-of-job Nigerians cashed out N207.91 billion being the 25 per cent unemployment pension benefits from their retirement savings account (RSAs) in the second half of last year alone.

Pension contributors who were disengaged and are unable to secure other jobs for four months are entitled to 25 per cent drawdown from the total saving.

In the fourth quarter alone, the drawdown was N111.73 billion, which was over N105 billion above N6.4 billion withdrawn in the same period in 2021. The third quarter of 2022 also saw unemployment pension benefits hitting N96.18 billion.

The spike in the outflow from the pension funds as contained in the quarterly reports of the National Pension Commission (PenCom) underpins rising job losses.

Nigeria’s current unemployment status is a subject of speculation, as the National Bureau of Statistics (NBS) has not conducted a survey in over tw o years. The last report, which was released in 2020, put the country’s unemployment rate at 33.3 per cent – the highest in recent memory.

The statistics office recently said it intends to adjust the methodology used in calculating unemployment figures in Nigeria. The Statistician-General of the Federation/CEO of NBS, Semiu Adeyemi Adeniran, disclosed the plan during a sensitisation workshop in Abuja months after the Ministry of labour called it out for creating confusion in its data.

“This new concept and approach of conducting the survey will add new questions on persons employed but not at work, long-term unemployment, job satisfaction, discouraged job seekers, and information on decent work.

“This new approach involves data collection from a carefully selected sample of over 35,000 households, spread over 12 months, instead of the large 33,000 samples surveyed every quarter,” Adeniran said.

Whereas there is no current data about the number of jobless Nigerians, economists said the protracted impacts of COVID-19 and other macroeconomic risks have taken a serious toll on the country’s labour market.

The risks have been worsened by the recent energy crisis and naira redesign, which is said to have thrown thousands of Nigerians operating in the cash-dependent informal sectors out of jobs.

According to the PenCom data, there was also a spike in the outflow from the active portfolio of the contributory pension fund (CPS) to retirement funds/ unemployment benefits.

In the last reported quarter, for instance, N586.17 billion was approved as outflow, an amount that was 67.6 per cent higher than N349.7 billion converted in the previous quarter.

The Q4 approved sum was 280 per cent above N154.54 billion withdrawn from the active fund in Q4 of 2021.

The report also reveals an uptick in the withdrawal from voluntary contributions. In Q4 ’21, the amount withdrawn was N1.672 billion. The amount fell to N887.94 million last quarter. The figures are well above withdrawals from the accounts in the previous quarters.

According to the report, exposure of the pension fund to Federal Government securities increased to N9.64 trillion or 66.86 per cent of the total fund last quarter. The amount staked in the asset class was N9.19 trillion in the previous quarter.

“The net unrealised gains on bonds and equities amounted to N0.84 billion for Q4:2022. This was due to net appreciation in the prices of securities in the Fund’s portfolio. Additionally, the fund realised gains amounting to N0.21 billion on the disposal of securities during the period,” the report noted.


Please enter your comment!
Please enter your name here