Cover  

Ajaero: It’s existential threat to borrow workers’ fund

Ajaero

President of the United Labour Congress (ULC), Comrade Joe Ajaero, in this interview with GLORIA NWAFOR, insists that pension funds should not be subjected to uncertainties, adding that as an issue that borders on the livelihoods of its beneficiaries, it is better treated responsibly and sensitively.

Some key stakeholders want the labour movement to engage the Federal Government, by asking relevant questions, rather than opposing outright, its plan to borrow N2t from the contributory pension fund. What do you make of this?
Our reaction to those who want us to engage the government rather than opposing it will be; what are we doing already? Is engagement only when we agree with the government? If government engages us from afar, we can also engage it from our side of the fence. It does mean that this form of engagement is the one thrust upon us by the government.

However, if by engagement they mean face-to-face discussions, why not? That is what we do every day in the trade union. We are willing to sit down and discuss, but we are not going to beg the village chronic beggar, who has told me from afar that he will be coming to my yam barn to take my yams. Will it not be irresponsible on my part to keep quiet? My first reaction will be; please keep your distance because I know that my storehouse will be under severe threat. We wonder if there is anybody that feels comfortable when a well-known kleptomaniac visits his house.

The Federal Government is said to have been borrowing from the fund since 2004 when the policy was introduced through money instruments. How come the issue of borrowing is suddenly becoming a controversial one?
Money market operations are essentially driven by the dictates of the market place, and finds expression in the willingness of the depositories of diverse funds to decide to either invest in it, or not, given their readings of the market fundamentals. Yes, this has been going on and we have not had any cause to worry.

Why would government announce it if it does not have some fearful intents? Now, when you talk about it and announce it, you are no longer talking about the same thing. Perhaps, you want to do something that is a shift from the norm, meaning that this has something to do with extra money market decisions.

We are afraid that government may want to force the Pension Fund Administrators (PFAs) to surrender the funds to them without considering the dictates of the market place, which is mainly rational driven, by hard-nosed economic reading of market situation.

It is this, which we read as an attempt at hijacking the pension fund. Open market operations are voluntary and it should be allowed to be so without any undue pressure from the government. Let the treasury bills flow and if the PFAs so choose, let them invest in it with proper understanding of the yields, and safety of the funds.

In other climes, investment in government instruments carries the lowest risks, but in Nigeria, the risk elements may be on the increase. With the level of corruption increasing and wrong economic policies, it may be dangerous to invest in such bonds now, and also given the existential questions of insecurity that stares the nation in the face within the context of the seeming helplessness of the government to deal with it. Given these indices, why would an investor, especially the PFAs invest in our government bonds? And why would Nigerian workers be comfortable if our life-savings are tied into such investments? It does give us reasons for concern.

High fiscal and administrative costs, low coverage and benefits and unpredictability of old-age income due to capital market risks are some of the reasons that the International Labour Organisation (ILO) adduced against privatising pension. In the light of this, is labour doing the right thing by resisting the borrowing of its members’ contributions?
Pension funds should not be subjected to uncertainties and that is why we are focused on ensuring that we interrogate any action either by government or any other that threatens, or endangers it, especially if we see it as capable of exposing it to such wind of uncertainties. A lot of factors, which we had marshalled out earlier expose our pension funds to great risks.

For the avoidance of doubt, trust and confidence are essential ingredients in the financial market and we do not have enough of that where our contributions are concerned, if left in the hands of Nigerian politicians.

are some of the reason why we think that there are great uncertainties in this proposal to “borrow.” Corruption distorts and creates uncertainties; incompetence and unreliability of government policies create fear and uncertainties; increasing insecurity of life and properties create uncertainties; not complying with due process and rising debt portfolio create uncertainties; questionable repayment strategies designed to erode the value of the funds remains fearful.

If the money market lenders are scared of lending money to the government as publicly announced by the Minister of Finance, should our funds be the one that should be exposed. Imagine mere mortals trying to tread where Angels fear to tread!

There are the chances that borrowing the said amount does not compromise extant laws, so why won’t labour explore available options before shutting the door against government?
The law has stated how these funds should be administered and we only want government to comply with their own laws. The process for accessing funds from the PFAs is well known. So, let the government follow that and not be dramatic about it. Attempting to distort the laid down rules raises dusts and questions their motives. Strict compliance with the due process and less impunity is what we demand.

We are not shutting government out of the funds, but government shuts itself out when it refuses to follow the due process, which despite its weaknesses guarantees the security of the funds. The law did not say government should compel the PFAs to lend to it or buy their stocks.

Government says the repayment plan has taken into account when most of the subscribers would be due for retirement hence ready for their payments. Can’t the government be given the benefit of doubt?

That is also one of the problems. Government ought not to determine how and when the funds get into the hands of beneficiaries. It is in the hands of the Pension Commission, through the PFAs. We want to automatically access our funds through the PFAs when we are qualified. We do not want the government to tell us whether they are ready or not. We want the PFAs to have enough of our contributions all of the time, whenever and wherever we need it. Government should hands off the funds and leave the administrators to do their jobs, while they concentrate on policies and regulations.

Former presidents, governors, lawmakers and sundry political office holders sign off huge amount of money as pension for themselves after their four or eight-years tenures as the case may be. Why would money meant for retired workers that have worked for 35 years be the ideal fund for infrastructure improvement?
The fraud that was the humongous allocation to former public office holders as pensions, fortunately has been nullified by the courts, and any government that still pays such scandalous heist is in contravention of our laws. The unfortunate thing is that they collect such funds without recourse to the laws, which they made only for workers, meaning that they do not trust the laws, which they made.

You ask yourself why can’t they subject themselves to the dictates of the Pension Act, rather than the unwholesome theft of public funds in the guise of pensions? 
The unfortunate thing in Nigeria is that the weak and the vulnerable, especially Nigerian workers are constantly left to carry the wrong end of the stick. We are left with the burden of the errors and profligacies of our politicians just like in this case. They take theirs but put ours in infrastructure just like they destroy our health system but go abroad to treat themselves; destroy public schools and send their wards abroad for education and now, they want to destroy the nation so that they can hop into their private jets and fly abroad while we remain here and suffer just like they did the last time.

The ULC, which you lead, says it does not have confidence in the sincerity of our politicians to deliver on the safety of workers’ life-savings when it is entrusted into their hands. What measures do you want in place before acceding to the borrowing plan?
Yes, we do not have enough confidence or trust in our ruling elite to leave our pension contributions in their hands. This is both historically and currently objective. It would be better if the funds are run the way they have been running it. We do not want to see any shift in the processes for administering the funds. So, ULC wants to see full compliance with the laws guiding the operations of the pension funds; see total agreement bidance with due process without undue pressure from government; see full dialogue between the government and the major stakeholders of the funds such as the ULC, TUC, NLC, NECA, government and PENCOM.

We want government to tell Nigerians where and how it hopes to repay the funds it is planning to borrow.

It is also important that government also tells Nigerians what it has done with the funds it has borrowed before and the results, including what it wants to do with the funds it wants to borrow from the pension funds – not just the blanket – infrastructure.

ULC makes bold to say that Nigerian workers are willing and have always made sacrifices in our effort at building the Nigerian nation. Politicians should also make sacrifices and stop nosing around for where they can snatch funds. We are all stakeholders, but we cannot mortgage our future which the pension funds represent. It is an existential issue and it is better treated responsibly and sensitively.

Receive News Alerts on Whatsapp: +2348136370421


No comments yet

Related