“I passionately hold that no pensioner should go through unnecessary hardship to earn his or her pension after serving the country. People who take liberties with pensions should not be allowed to get away with it. It is a terrible crime to defraud helpless, old people.”
Those were the words of Finance Minister Ngozi Okonjo-Iweala who on Friday appeared before legislative Joint Committee on Pensions Administration in Abuja, after it was recently discovered that the pension funds due police pensioners was bloated by up to 74 billion naira.
According to Ms. Okojo-Iweala, the money was saved from a verification exercise and biometrics at the police pensions office, which was receiving the sum of N1.5billion monthly for the payment of retired police personnel.
A verification exercise initiated by the finance minister in 2011 which was carried out by a Pensions Reforms Task Team in 2011 later cut the actual amount due the office by one third to N500 million monthly, saving the government a monthly N1 billion.
The minister explained that she got involved in the police pensions in September 2011 and had to freeze the accounts after reports reached her from the PRTT Chairman, Abdulrasheed Maina, that there was fraud in the office.
“As Finance Minister, my first instinct was to seek the permission of Mr. President to freeze the accounts, and that is exactly what I did. We had to make sure that every activity regarding the accounts had to be stopped,” she said.
According the minister, KPMG was subsequently invited to audit the police pensions and a number of revelations were made.
She said, “KPMG confirmed what Maina said that N1.5billion to Police Pensions Office monthly when only about N500million was required. The firm also confirmed that N24billion was kept in account meant for the payment of harmonization arrears.
“KPMG also confirmed that accounts were being opened and monies belonging to the Police Pensions were being moved around. It was discovered that every new management opened new accounts in banks and moved funds around.
“They confirmed that there was a struggle among the Head of Service, the Task Team and the Police Pensions for control over these accounts.”
Okonjo-Iweala confirmed that there were irregularities in the administration of the police pensions before the appointment of the task team and the irregularities continued during the period of the operation of the task team.
She further noted that the total balance of the amount belonging to the pension office was N33billion, but police pensioners were only paid after an authorization by the Minister of Finance following an approval from Mr. President.
She said there was the practice of using pension funds for administration purposes, which was a breach of extant financial regulations.
Okonjo-Iweala said KPMG confirmed that the payment of the N119million to pensions was appropriately paid out contrary to the allegations raised by the Task Team.
Chairman of the Task Team, Alhaji Maina, who was declared wanted by the committee on Thursday, appeared on Friday to answer questions on some of the allegations put against him.
An obviously rattled Maina had problems explaining how the names of the EFCC Chairman and the former Inspector General Police found their way into the list of 15 persons who travelled abroad for biometric data capture and yet did not make the trips and monies were said to have been paid to them.
He however raised objections as to the authenticity of the documents, and requested for the original copies before he could make his defense.
Maina insisted that he had saved the government N28billion from the restructuring of the police pensions, citing records available at the police pensions.