Contributory Pension Scheme and Transitory Job Loss in Nigeria
Abstract
Surviving the transitional period of job loss before finding a new job poses significant challenges for individuals. Therefore, this study aimed to investigate how the administration of contributory pension schemes affects transitory job loss in Nigeria. Employing an exploratory research design, this conceptual paper reviews existing literature to assess the extent of research on contributory pension schemes and transitory job loss. The study's findings revealed that individuals who lose their jobs encounter difficulties in accessing 25% of their pension contributions. These challenges arise from complex administrative procedures, non-remittance of contributions by employers, and a lack of awareness about the option to access a portion of their contributions in the Retirement Savings Account (RSA) in case of job loss. Moreover, this research indicated that contributors who experienced job loss, particularly during the COVID-19 pandemic, lacked a savings and investment culture, leading to financial hardship during the waiting period to access a part of their RSA contributions. It was concluded that contributors who undergo transitory job loss in Nigeria encounter obstacles in accessing their pension contributions. The study recommends that efforts should be made to simplify the administrative processes involved in accessing pension contributions to ensure a smoother withdrawal experience for contributors facing job loss.
