HOW SAFE IS ARMED FORCES PENSION UNDER MILITARY PENSION BOARD?
By ROSMARY ONUOHA
Allegations emanating from the probe into the Police Pension scheme has raised questions as to whether the military has capacity to manage its own pension scheme
In 2010, the Military Pensions Board, MPB, aggressively lobbied and canvassed for the members of the Armed Forces and Intelligence/Secret Services of the Federation to be exempted from the Contributory Pension Scheme, CPS, being regulated by the National Pension Commission, PenCom.
The exclusion, according to the MPB, became necessary to eliminate delay in the entitlements of retired service personnel; disparity in the lump sum paid to personnel of the same rank; low monthly pension being paid to retired personnel and the glaring differences between the old and the new system of pension administration.
Others are that the CPS is in breach of the principle of non-visibility and non-public disclosure of the members of the Intelligence/Secret Services according to best practices all over the world and which breach would easily compromise their operations and expose such operatives as targets of hostile foreign intelligence, a situation inimical to Nigeria's national security.
On the opposing side however, Mr. Funso Doherty, a pension fund operator argued that the amendment to extricate the military from the CPS would portend danger for administration of pension in the country. According to him, extricating the military from the scheme would not address the problems confronting pension administration in the country as pension was a significant component of the economy.
The opposition notwithstanding, in November 2010, the prayer of the MPB was answered as the Nigerian Senate passed a bill amending the National Pension Act of 2004, effectively excluding members of the Armed Forces and Intelligence/Secret Services of the Federation from being part of the pension scheme for all public and civil servants.
The passage of the bill meant that the military (Military Pensions Board) and the related Intelligence and Secret Services will now run their own pension schemes outside the purview of PenCom.
However, with the alleged fraudulent practices that have been uncovered in the wake of the Police Pension Office, PPO, probe, stakeholders are beginning to ask if the government should continue to allow the military to operate an independent pension scheme with no supervision.
In the course of the PPO probe, series of allegations came up. It was alleged that after biometrics, pensioners' names disappeared from the payroll, hence many pensioners are not yet paid; money was diverted through various means; money was stashed away in foreign accounts; disappearance of the names of genuine retirees from the police pension list; as well as some retirees receiving pension in about three points, including the office of Head of Service of the Federation (HOSF).
Also, the report of a forensic audit conducted by KPMG documented the unhealthy practices adopted by the Abdulrasheed Maina-led police pension office and others by constantly moving around all or part of the huge funds released by the Federal Government for the payment of police pension arrears.
One case cited in the KPMG report is the 24 billion payment made by the government into the bank account of the police pension office on July 19, 2010. Few days after the release of the funds the entire N24 billion was moved into a fixed deposit account.
The KPMG report added, our analysis of the available bank statements reflected that there had been several instances of movement of part and all of the N24 billion harmonization fund, from one PPO bank account to another, during the tenures of Kigo and Wada, as directors of PPO as well as during the tenure of Maina at PPO
Fears about military pensions
At the height of the campaign by the military for the exemption of the armed forces from the CPS in 2010, there were fears that the scheme will be hijacked by the top military personnel in the long run. With the unfolding drama following the PPO probe, the fears are beginning to resurface once again.
Mr. Gbadebo Olatokunbo, an economic expert noted that the generals are comfortable being exempted from the CPS but the junior officers are not happy with the arrangement.
According to him, before the Pension Reform Act came into effect in 2004, pension administration was a major headache for government. But under the management of PenCom, pension is wearing a new look.
He said 'Eight years is not too long a time for all to forget that in the 'old regime' of military pension, some pensioners who found themselves on queues died under the scorching sun, cold rain and even under the bridges that turned into homes for some while trying to get their retirement benefits.'
Olatokunbo therefore stressed that government must put all structures in place to ensure that the ugly development being witnessed in the PPO does not crop up in the military pension scheme.
Mr. Musa Ibrahim, an officer at PenCom noted that the Military Pension Board fought to be exempted from the CPS after its pension was effectively managed by PenCom. As such, the Board must toe the line of PenCom in the management and administration of its pension scheme.
For Mr. Mohammed Ahmad, Director General of PenCom, since the government deemed it necessary to reverse its policy on pension to exempt the military from the CPS, it will not be in the interest of low ranking military officers and the generality of Nigerians if the scheme is muddled with frivolities or allowed to fail.
Commissioner, Technical of PenCom Ms. Eyamba Henshaw charged Nigerians to go back into history and recall when military men were dyeing on the queues under the rain and sun just to collect their pension benefits, arguing that a lot of people died without getting any retirement benefit because of the inefficiency of the military then to handle the pension effectively.
According to her 'Nigerians easily forget the past when the future has become nice. In the past retired soldiers that have honourable served this country were sleeping and falling on queues to get pension benefits because the custodian of their benefits did not manage the funds very well.'
She therefore called on the federal government to take all necessary steps to safeguard the current pension scheme of the armed forces.