Title: Nigerian Brethren revamp pension plan Subject: Church of the Brethren Newsline Date: May 25, 2006 From: Church of the Brethren News Services Contact: Cheryl Brumbaugh-Cayford, 800-323-8039 ext. 260, _cobnews@brethren.org_ (mailto:cobnews@brethren.org)
NIGERIAN BRETHREN REVAMP CHURCH EMPLOYEESâ PENSION PLAN
May 25, 2006 (Elgin, IL) -- The Majalisa, or annual conference, of Ekklesiyar Yan'uwa a Nigeria (EYN--the Church of the Brethren in Nigeria), h as voted to implement a new pension plan for its church workers.
The plan follows guidelines established in part by a recently-passed Nigerian pension law, and was developed with the help of Tom and Janet Crago . The Cragos serve as short-term mission workers in Nigeria with the Church of the Brethren General Board.
The new plan provides benefits for all current and future EYN employees, plus existing pensioners, and was passed after "considerable debate about th e costs involved," according to reports from Nigeria. It replaces a pension pl an in which most employees and congregational employers did not have to contribute directly to the cost of their future pension benefits. Such "pay -as-you-go" pension plans have been quite common in Nigeria in the past.
The Cragos explained the previous system: "Each church pays 15 percent of its offerings annually to EYN headquarters to cover the operating costs of the Headquarters Office, but these revenues were not keeping up with the growth in yearly pension expenses. All pension costs were being paid out of the headquarter's annual revenues, and it clearly wasn't going to be enough to g et the job done in the years to come." By the end of this year, EYN could hav e nearly 100 retirees, compared with only about 850 active employees.
Under the new plan, congregations will pay 27.5 percent and employees will pay 10 percent of each employee's salary, including housing and transportation allowances. Ten percent of the employer's contribution, match ed by the employee's 10 percent, will go into a savings account for the employee. The remaining employer's 17.5 percent will go to fund the cost of current pensi oners, and to build reserves to cover the accrued pension liabilities of EYN for current employees. Each employee's individual pension savings account will be held by a licensed pension custodian for each worker's future benefit.
"This is huge step for EYN!" said the Cragos. "They are committed now to fully funding both past and future retirement benefits for their employees. The real impact of this change--in a country where parents often say that they have children in order to ensure a decent retirement in old age--remains to be seen. It has the potential to change traditional social norms about retirem ent planning."
EYN has stepped up to this new pension challenge sooner than most employer s in Nigeria, the Cragos said. Even many government agencies have reportedly not yet implemented their plans.
In continuing work on the EYN plan, Tom Crago will help calculate the â €œnet present valueâ of each employee's accrued pension benefits as of Jun e 25, 2004, when the new legislation took effect. He also will work with the new EYN Pension Board to develop daily operating procedures for the Pension Office. Janet Crago will develop an employee pension database for the Pension Offic e, and will handle some of the computer training for EYN staff who will maintain the data.
The Church of the Brethren is a Christian denomination committed to continuing the work of Jesus peacefully and simply, and to living out its fa ith in community. The denomination is based in the Anabaptist and Pietist faith traditions and is one of the three Historic Peace Churches. It celebrates it s 300th anniversary in 2008. It counts about 130,000 members across the United States and Puerto Rico, and has missions and sister churches in Brazil, the Dominican Republic, Haiti, and Nigeria.
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For more information contact:
Cheryl Brumbaugh-Cayford Director of News Services Church of the Brethren General Board 1451 Dundee Ave., Elgin, IL 60120 800-323-8039 ext. 260 _cobnews@brethren.org_ (mailto:cobnews@brethren.org)
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