My view on Pension Reform Act misrepresented – Babafemi Ojudu
My attention has been drawn to the misgiving generated by media reports on my contribution to the debate on amendment of Pension Reform Act.
Some of the reports quoted me as saying that the pension fund, which recently hit N3.4tr, is lying idle and should therefore be channelled into infrastructure development. Many have interpreted this to mean that the pension fund will end up as proceeds of corruption.
First, I want to appreciate the scrutinising attention that Nigerians now pay to issues of governance. This is healthy. I wish more Nigerians, especially youths, will continue to deepen the practice of engaging leaders and holding them responsible.
However, I wish to clarify here that the quote ascribed to me in the reports on the debate largely misrepresented my views.
The underlying idea of my contribution is that of eating our cake and having it back. For instance, a Nigerian is employed in Abuja of Lagos. He has to live in the suburbs due to high cost of rent and goes through harrowing stress commuting to work daily.
If this fund is used to construct affordable housing accessible through mortgage and he benefits, he can live a happier life, keep his job, pay the mortgage and still have his pension paid when he retires. The fund can be used to construct other infrastructure that improves standard of living.
While it is fair to argue that housing and roads are government's responsibility, but judging from global trends, I fear that Nigeria's real sector may be damned for as long as this argument holds in its strictest sense.
The May 2013 World Bank's Nigeria Economic Report on Nigeria repeated what we knew already: that “Nigeria's economic growth has not automatically translated into better economic and social welfare for Nigerians.”
The money market is growing but the real sector is crawling. This is the reason why the poor will get poorer because they lack the capital and financial intelligence to be a player in the money market.
It will be ironical for us to complain that financial institutions are not lending to the real sector when about 60 per cent of the Working Class's pension fund is tied up in the money market.
So, if pension fund is channelled to work for the working class through investments in the real sector, especially housing, agriculture and Information Technology which have the highest job creation potential, I believe it is the right way to go. This may even encourage financial institutions to have a rethink.
The amendment bill for the Pension Reform Act has been sent to Committee for Establishment and Public Service of the Senate.
As public hearing starts earnestly, I urge Nigerian workers, labour organisations, students and other stake holders to attend with this same spirit of ensuring that their money is used to work for them.
Senator Babafemi Ojudu
Ekiti Central Constituency
June 14, 2013.