N1.159tn pension fund assets available for investment in infrastructure is currently lying idle, says the National Pension Commission.
The commission revealed on Wednesday that only N1.36bn had so far been invested in infrastructural projects.
Director-General, PenCom, Chinelo Anohu-Amazu, made this disclosure during a presentation to the House Committee on Pensions at the public hearing on the need to invest pension funds to meet Nigeria’s infrastructural challenges.
Anohu-Amazu said: “The investment regulations allow for investment in infrastructure through infrastructure bonds and infrastructure funds. However, despite the availability of about N1.16tn for infrastructure financing, only N1.36bn had been taken as of December 31, 2015, leaving about N1.159tn untapped.”
“This is largely due to the non-availability of investment instruments that qualify for pension investment as stipulated in the investment regulations issued by the commission.”
“Capital provided by pension funds, which are long-term obligations, are best suited to address the need for long-term financing instruments that have maturities commensurate with the long-term nature of infrastructure projects.”
“Indeed, several countries in Europe, North and Latin America as well as Africa have successfully utilised part of the accumulated pension funds by investing in new infrastructure projects or renewing dilapidated ones.”
“It is, therefore, understandable that given the infrastructure deficit in Nigeria, pension funds need to be mobilised for investment in such projects.”
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