Fed Govt releases N44b for unpaid pension

A total of N44 billion has been released by the Office of the Accountant-General of the Federation (OAGF) to pay federal retirees.

This was made known in a statement by the National Pension Commission (PenCom).

The statement read: “This sum is part of the 2024 budget appropriation for January to June and has been deposited into the Retirement Benefits Bond Redemption Fund (RBBRF) Account at the Central Bank of Nigeria (CBN).

“The primary objective of this disbursement is to partially settle the accrued pension rights of retirees of Federal Government Treasury-funded Ministries, Departments, and Agencies (MDAs) under the Contributory Pension Scheme (CPS).

“The disbursed funds have been applied to settle the accrued pension rights of duly verified and enrolled retirees, covering the period March to September 2023 and some deceased employees. Accordingly, the remittances have been credited directly to the Retirement Savings Accounts (RSAs) of the affected retirees through their respective Pension Fund Administrators (PFAs).”

According to PenCom, this move follows the recent disclosure by the Director-General of the National Pension Commission (PenCom), Ms Omolola Oloworaran, that plans had reached advanced stages and were expected to lead to lasting solutions that would resolve the challenges of inadequate funding and delayed fund releases for retirees’ accrued pension rights.

“The issue of delayed payments of accrued rights has been an albatross for the CPS, undermining the scheme’s primary objective of ensuring that retirement benefits are paid promptly. The intractable delays, in turn, have caused hardship to retirees of treasury-funded federal MDAs.’’

It continued: “The Contributory Pension Scheme (CPS) was designed to provide a sustainable and robust retirement savings plan for Nigerian workers. However, the delay in payment of accrued pension rights for FGN retirees which are the benefits earned by FGN MDA employees for their years of service before the CPS, has been a challenging issue. The accrued pension rights for FGN retirees cover the period of service up until June 2004 when the CPS commenced and, represents the pension entitlements borne by the Federal Government distinct from the contributions made to individual Retirement Savings Accounts (RSAs).

“Recognising the vital importance of the timely resolution of this issue of accrued pension rights, PenCom has prioritised engaging with the relevant authorities to secure the full settlement of all outstanding liabilities. The National Pension Commission’s commitment to settling pension issues is rooted in its dedication to safeguarding contributors’ and retirees’ financial future, ensuring that the Contributory Pension Scheme provides timely and adequate retirement benefits.

“The recent release of N44 billion marks a significant step towards addressing the challenges. Nevertheless, PenCom understands that work remains to be done to resolve retirees’ challenges in accessing their pensions.The Commission assures retirees that efforts will be sustained to ensure the full settlement of accrued pension rights for retirees.

“Following the release of the funds, PenCom directed Pension Fund Administrators to expedite payment processing to ensure that the retirees receive their entitlements as quickly as possible. Furthermore, PenCom expressed appreciation to the retirees for their patience and understanding throughout this period of uncertainty and reaffirmed its dedication to safeguarding their retirement benefits at all times.’’