Why Former BPE Director Doesn’t Have Terminal Benefits



THE Bureau of Public Enterprises, BPE, has clarified that by the provision of Section 4 (1) of the Pension Reform Act 2014 (Pension Act), an employer has an obligation to make a contribution of a minimum of 10 percent of the employees’ monthly emoluments in addition to a minimum of eight percent contribution by the employee and remit both sums to the employees’ retirement savings account, RSA.

Benjamin Ezra Dikki, director-general of the BPE, made the clarification in reaction to a complaint by Ibrahim Kashim, a former director of the Bureau, over the non-payment of his terminal benefits.

The BPE, in a statement, said that upon retirement and attainment of the age of 50 years, in accordance with the provision of Section 7(1)(a), the employee would be entitled “to a withdrawal of a lump sum payment and subsequently a programmed monthly or quarterly withdrawals calculated on the basis of expected life span.”

The statement said further that once the employer made the statutory contributions, it had no other obligation to the staff retiring.

According to the statement, the Bureau in its desire to ameliorate the plights of its former staff who retired and the financial dislocation they went through before they could access payments from their RSA, decided to explore the provision of Section 4(4) (a) on the Pension Act which gives employers the discretion to make additional payments of benefits to its retiring employees.

“It was intended to provide a cushion of funding for retiring staff pending when they were able to process and access their RSA’s.  Consequently, the National Council on Privatization approval was sought to create terminal benefits for the Bureau’s staff who are retiring.  This was however, subject to the approval of the Salaries and Wages Commission, the body that has the statutory powers to approve Salaries and Allowance of Public Servants. The Salaries and Wages Commission declined approval of the Terminal Benefits on the grounds that the Bureau cannot be singled out of the entire Public Service for such special treatment.  Once the Salaries and Wages Commission does not approve the benefits, such cannot be included in the budget template and be funded,” it stated.

The Bureau said that in line with the provisions of the Pension Act and the determination of the Salaries and Wages Commission, there was no terminal benefit payable to Kashim or any staff.

The BPE statement signed by Alex E. Okoh, head of public communication and dated January 9, reads as follows:

“We wish to emphasis that all retirement benefits are paid by PENCOM in line with the Pension Act and all the ex-director’s records have been forwarded to PENCOM for payment. He has been advised to follow-up with PENCOM for payment.



Mall Ibrahim M Kashim lied when he stated, “….. The former DG Ms Bolanle Onagoruwa was removed partly because she has refused to accept the appointment of a prominent PDP lawyer to wind up PHCN for an amount  exceeding N1.5billion……… immediately after her removal the current DG, established a committee that awarded the assignment to the preferred Law firm.”

“The fact is that the National Council on Privatization at its 3rd Meeting of 2013 held on Thursday May 9, 2013 had approved the engagement of Messrs J K Gadazama as the consultant for winding up of PHCN.  Benjamin Ezra Dikki was appointed acting DG on 27the November, 2013, over six months later.


The provision of Group Life Insurance Policy for employees is mandatory and compulsory under section 4(1) (5&6) of the Pension Reform Act 2004. The maxim of no premium no cover does not apply here where the law explicitly provides, “Every employer shall maintain Group Life Insurance Policy in favour of each employee for a minimum of three times the total annual emoluments of the employee and premium shall be paid not later than the date of commencement of the cover’’.  Thus, PHCN Successor Companies as employers of labour before privatization were mandated by law to provide these classes of insurance to its employee in compliance with the Pension Act.

“It was established that there was an Insurance Policy between GNIP and PHCN.  Premiums were outstanding  for year 2011/2012 amounting to N13,607,151,141.10 and renewable for the year 2012/2013 at the sums of N13,581,080,774.10, totaling  N27,188,232,208.20 for which payment was outstanding.  PHCN had already filed claims with GNIP for 267 staff that died in active service for compensation to the relations/widows of the deceased.  GNIP did not pay the claim because PHCN did not pay premiums due for 2011/2012 and 2012/2013. PHCN submitted these claims to the Implementation Committee set up by the National Council on Privatization for the processing of entitlements to PHCN Staff  that  then made representations to the then Minister of Power. The Minister of Power presented the matter to the Vice President in a memo dated 23/12/2013.   It was subsequently presented to and approved by the National Council on Privatization at its 3rd meeting held on August 4th, 2014, for payment.  BPE transferred the sum to the Office of the Accountant General of the Federation for further action.

“As mentioned earlier, at a special meeting held, on January 12, 2013 the NCP set up an Implementation Committee, chaired by the Minister of State for Power to handle the processing and payment of entitlements of PHCN Staff based on the approvals given at the same meeting.  This Implementation Committee chaired by a Minister comprised of representatives of various Ministries and Agencies, was superior to BPE management.  Thus no single one of the forty tranches of payments to PHCN Staff ever came to the BPE management for consideration. It is in compliance to the same process that the Insurance premium payment did not have to come to BPE management as insinuated by Ibrahim Kashim. Once the implementation Committee processed and verified PHCN Staff entitlements, it advised BPE and BPE remitted the relevant sums to the office of Accountant General of the Federation that effected payments as appropriate.”

— Jan 11, 2016 @ 19:50 GMT


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