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Concern mounts on Constitutional Amendment Bill on Devolution of powers, interest on pension – Part 2

by Editor

September 6, 2017 | 12:18 am
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There is no gain saying the fact that the current constitutional amendment exercise being undertaken by the National Assembly would naturally attract the attention and keen interest of Nigerians in view of the importance of that document as the sine qua non of our social contract as a nation. One major area of such exercise that has attracted and is still attracting attention, is the Bill No. 3 on Devolution of powers, which among other things seeks to ensure that the Central Government cedes certain powers to the States.

It is appropriate at this juncture to reproduce the proposed amendment on pensions in the Bill No.3, in order to clearly see its needlessness. It provides as follows:

“Pensions:

(1). The National Assembly may make lawsfor the federation or any part thereofwithrespect to –

(i) the regulation of matters relating topension and gratuity of federal employees, persons in the public service of the federation, employees of federal statutory institutions and parastatals and other persons subject to federal regulation including employees of incorporated companies regulatedby federal enactments;

(ii) setting of standards for management of pension matters throughout thefederation in respect of workers whether in private or public employment;

(iii) making laws for the regulation of pension matters in relation to persons in military service, the police force and other paramilitary and security agencies in the federation.

(2). The House of Assembly may subject to paragraph 1 hereto make laws relating to the regulation of matters on pension and gratuity of state employees, persons in the civil service of the state, employees of state institutions and parastatals, employees of local governments within the state and other persons subject to state regulation including employees of business enterprises resident within the state and subject to state regulation.

  A brief but critical analysis of the foregoing provisions of the Bill No.3 on Devolution of Powers will unavoidably lead to the following conclusions:

    i.            Items 1(i) &(ii) above merely restated the essence and purport of the provisions of Section 173 and 210 of the 1999 Constitution as well as Item 44 of Part 1 of the Second Schedule to the 1999 Constitution (Exclusive Legislative List) relating to the responsibility of the National Assembly to make laws providing for and regulating the pension rights of employees in the public service of the federation. This, in our considered opinion, is needless and does not justify the time and resources deployed in constitutional amendment process.

    ii.            Item 1(iii) above is completely unnecessary and adds no value whatsoever. Firstly, the services and agencies listed under that provision squarely fall within the ambit of the definition of ‘public service of the federation’ under Section 318 of the 1999 Constitution. Hence, these have been captured under Section 173 of the 1999 Constitution. Indeed,  the preceding provision of Items 1(ii) & (ii) of the same proposed provision on pension under the Constitution Amendment Bill No. 3 on Devolution of Powershave adequately captured these agencies and clearly expressed the powers of the National Assembly to make laws for the administration of their pensions.

  iii.            The introduction of a superfluous provision in the Constitution such as Item 1(iii) would unnecessarily compel the understanding that the National Assembly has another constitutional responsibility of law-making on the subject of pension, which is distinct from the one prescribed under Section 173 of the 1999 Constitution and Item 44 of the Exclusive List. This understanding would have been both wrong and absurd, in view of the fact that the definition of ‘public service of the federation’ in Section 318 of the 1999 Constitution has settled the extent of legislative powers and duties of the National Assembly with regards to protection of pensions for public servants, including the police and other uniformed services, under Section 173 of the Constitution.

  iv.            Thus, when viewed against the above exposition, one would be at liberty to speculate that a proposal seeking to distinguish certain categories of federal public servants on the issue of pension would appear to be suspect especially in the face of a Bill sponsored by a member of the House of Representatives seeking to exempt the personnel of such agencies from the Contributory Pension Scheme.

    v.            Item 2 of the Constitution Amendment Bill No. 3 on Devolution of Powers is equally unnecessary and a non sequitur. This is based on the provision of Section 4(7) (a) of the 1999 Constitution (as amended) as well as an established constitutional law principle that any residual matter that is neither in the Exclusive nor is the Concurrent Legislative Listsexclusively left to the State Houses of Assembly to legislate upon. Thus, by introducing same as an item under the concurrent list, the proposal unwittingly hamstrings the State Houses of Assembly on such matters through the operation of the constitutional law doctrine of “covering the field”. The “federal might” could be exercised by the National Assembly to narrow the extent of legislation by State Houses of Assembly on such matters.

   vi.            Item 2 of the proposed amendment further complicated matters by introducing terms and concepts that suggest that State Houses of Assembly could legislate on “regulatory issues” in the pension industry. This is clearly a recipe for chaos and regulatory arbitrage, which would naturally bring unintended negative consequences that will require another round of tedious Constitutional amendment to address. Indeed, this glaringly offends the provision of Section 4(5) of the 1999 Constitution (as amended) which provides that “if any Law enacted by the House of Assembly of a State is inconsistent with any law validly made by the National Assembly, the law made by the National Assembly shall prevail, and that other Law shall to the extent of inconsistency be void”.

  vii.            Flowing from the above, it is pertinent to note that by virtue of Section 18 of the Pension Reform Act 2014 (PRA 2014) the National Assembly has conferred on the National Pension Commission the responsibilities of regulating, supervising and ensuring the effective administration of pension matters and retirement benefits in Nigeria. These include pension and retirement benefits established for the benefits of employees of States and Local Governments in Nigeria by virtue of Section 2(1) of the PRA 2014. Thus, acceding to the proposed amendment allowing State Houses of Assembly to enact laws establishing regulatory agencies on pension matters would directly be in conflict with the PRA 2014 and, therefore, invalid for reasons of its insistency with the provision of Section 4(5) of the 1999 Constitution (as amended). Source National Pension Commission


by Editor

September 6, 2017 | 12:18 am
  |     |     |   Start Conversation

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