Creating Awareness on the Establishment and Impact of Contributory Pension Scheme to the Workers of the Oke-Ogun Polytechnic Saki Oyo State - Nigeria

Abstract

Pension is a periodic payment made during an employee’s retirement from an investment fund or account to which that employee and their employer(s) contributed during the employee’s time as an active member of the labour force. Pension Reform Act 2014 governs the framework and procedure for pensions in Nigeria. The PRA establishes a Contributory Pension Scheme whereby the employers and the employees contribute minimum percentages of the employees’ salary to the scheme every month. The minimum contribution for the employer is 10%, while that of employee is 8%. In Nigeria today, almost every employee sees a deduction on their pay slip every month which is classified as ‘pension contribution’. Some employees know what it is and what it is for while some employees are still not sure or unaware of Contributory Pension Scheme. The objectives of this paper are to create awareness about the establishment and impact of the Contributory Pension Scheme to the workers of The Oke-Ogun Polytechnic Saki, Oyo State, Nigeria. The researchers used simple random sampling techniques and sample size of 250 was
taken. Out of 250 questionnaires that were distributed, 249 copies were returned and filled properly by the respondents. Data were collected from both primary and secondary sources and analyzed using percentage. The researchers used Chi-square to test the hypotheses at 5% level of significance. The results revealed that there is no relationship between awareness about the contributory pension scheme and the employee’s commitment (Χ2cal = 1.214 < Χ2 tab = 26.296); and the scheme has no significant impact on welfare of the workers (Χ2cal = 1.690 < Χ2 tab = 26.296). During the interview conducted, it was also concluded that none of the employees at The Oke Ogun Polytechnic Saki is a member of the scheme. The researchers therefore, recommend that
Oyo State Legislators should enact State Pension Law to compliment the effort of National Pension Commission.