19th November, 2015
The National Pension Commission (PenCom), on Thursday said Guidelines for Withdrawals of Voluntary Contributions from Retirement Saving Accounts was still in the making.
This is contained in a statement issued by PenCom’s Head of Communication, Mr Emeka Onuora, in Abuja.
The clarification is sequel to the warning by the Rivers State Council of Trade Union Congress (TUC), to embark on strike over the guidelines.
The TUC recently issued a press statement saying: “We will shut down if PenCom changes rules on voluntary contribution withdrawal unilaterally without recourse to the National Assembly.’’
The statement also said TUC had noted that the guidelines, as being issued by PenCom, negated some sections of the Pension Reform Act 2014.
According to the statement, PenCom said the provisions in the guidelines do not negate Section 4(3), Section 10(4) or any other section in the Pension Reform Act, 2014 as claimed by the TUC congress.
It said that the guidelines addressed only the taxation of pension fund and not mode of withdrawal of voluntary contributions from RSAs.
The guidelines in making say *any person making voluntary contributions to RSAs in addition to statutory contributions may withdraw up to 20% of the balance standing in the voluntary contribution portion not more than once in every four years.
*Subsequent withdrawals shall be based only on additional contributions made into RSAs after the last withdrawal.
*The balance of 80% shall not be accessed until retirement.
*En bloc withdrawal of the total voluntary contributions by an RSA holder is not permissible until retirement.
The statement noted that voluntary contributions into RSAs were meant to boost contributors’ final pension and not a savings account that could be drawn at will.
It explained that the guidelines would boost government’s fight against financial terrorism and money laundering.
It noted that the guidelines would also stop the dangers that could arise should a contributor decide to use his RSA to launder illicit money.
The statement also noted that the “guidelines was still a draft. The PenCom would expose it to stakeholders for their input in due course.’’
The statement called on the Rivers State Council of TUC to harmonise its position on the issue and make useful input into the guidelines before it is finalised.
It said “TUC is represented on the board of PenCom,’’ noting that workers could use the channel to address their grievances.