By Abigail Philip David
The National Pension Commission (PenCom) has announced plans to ensure a living wage for retired low-income earners, following the Federal Government’s approval of a ₦758 billion pension bond to clear all outstanding liabilities under the Contributory Pension Scheme (CPS).
PenCom’s Director-General, Omolola Oloworaran, disclosed this on Thursday in Abuja during a press briefing after the Quarterly PenCom/Operators Consultative Forum.
She described the ₦758 billion Federal Government of Nigeria Bond as a major milestone in pension administration, noting that it would restore confidence in the system and ensure retirees receive their entitlements without delay.
Key Allocations of the ₦758 Billion Bond
Oloworaran outlined how the funds will be distributed:
- ₦107 billion has been allocated to the Pension Protection Fund (PPF) to provide financial relief for low-income pensioners who may not have accumulated enough savings for a sustainable retirement. This marks the first time the Federal Government is directly contributing to the PPF, a move she described as a significant step towards strengthening pension security.
- ₦253 billion will be used to clear accrued pension rights owed to retirees from Treasury-funded Ministries, Departments, and Agencies (MDAs), ensuring that future payments are automatically included in the monthly personnel cost general warrant for timely disbursement.
- ₦388 billion has been earmarked to settle unpaid pension increases dating back to 2007, benefiting over 250,000 retirees. Oloworaran emphasized that this would make pensions more responsive to economic realities.
- ₦11 billion will address pension shortfalls for university professors, allowing eligible retirees in academia to receive their full salaries upon retirement, as stipulated in pension reforms.
A Turning Point for Pension Security
Oloworaran commended President Bola Tinubu for taking a bold and decisive step in pension reform, stating that the intervention has put the Contributory Pension Scheme (CPS) on a sustainable path.
She assured that PenCom will collaborate with relevant stakeholders to ensure the smooth issuance of the bond and the prompt disbursement of pension payments.
Additionally, she noted that resolving these pension liabilities would have broader economic benefits, including:
- Strengthening the financial market
- Boosting investment in the pension industry
- Enhancing economic stability
With the backlog addressed, she said PenCom will now focus on expanding the Micro Pension Plan, aimed at providing structured retirement savings for informal sector workers.
Oloworaran also thanked Minister of Finance and Coordinating Minister of the Economy, Wale Edun, for his role in facilitating the initiative. She described the development as a turning point for the pension industry, stating that with this intervention, the CPS can now fully deliver on its mandate of ensuring financial security and dignity for retirees.
