Nigerian retirees who left the offices of Federal Government ministries, agencies and other parastatals in 2023 were ascertained that their pension would be paid early. Still, they are yet to receive the payment.
Furthermore, delayed payments aren’t limited solely to retirees; they extend to death benefits and the dependents of deceased employees whose rightful entitlements are pending. These accrued rights encompass the benefits an employee earns over their years of service until June 2004, when the Contributory Pension Scheme (CPS) was introduced.
In March 2022, the Federal Government of Nigeria took a step forward by releasing N13.89 billion to settle the accrued rights for CPS retirees who exited service in 2022.
However, after this disbursement no additional funds have been allocated or disbursed, leaving many Nigerian retirees and their families in limbo regarding their financial security.
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Here’s Why The Nigerian Retirees Are Yet To Get Their Payment
Clarifying the claims about outstanding benefits to Federal Government retirees, the director general of the National Pension Commission (PenCom), Aisha Dahir-Umar said,
“The delayed payment of retirement benefits to some Federal Government retirees and deceased employees is because of the inadequate and delayed funding for the payment of Accrued Pension Rights. Payment of the accrued rights is subject to release of funds by the Federal Government. So, it is beyond the powers of the Commission.”
However, Dahir-Umar reassures beneficiaries that the commission has been in talks with the Federal Ministry of Finance for more disbursement to be made to settle these liabilities. She also noted that it is no news that the federal government has budgetary constraints, hence the delay.
She revealed that those enrolled under the CPS have been receiving their benefits through their Pension Fund Administrators (PFAs) and there is no unsolved complaint before the Commission. Nigerian retirees can be reassured of receiving their pension in due time.
The Director General Of PenCom, National Pension Commission (PenCom), Aisha Dahir-Umar Clarifies Misconceptions
In speaking to the media, the Director-General of PenCom clarified that the Federal Government of Nigeria neither took out a loan of ten trillion Naira (N10 Trillion) from the commission nor did the commission manage or keep its funds.
Dahir-Umar explained that,
“Investments by the PFAs in the securities of the Federal Government of Nigeria (FGN) are not loans as erroneously portrayed, but investments in securities, through bonds and treasury bills, as approved by the relevant government agencies, in this case the Debt Management Office (DMO) and Securities and Exchange Commission (SEC). They are traded on authorized capital markets. That is, the Nigerian Exchange Limited and FMDQ OTC Securities Exchange.”
In her explanation, Dahir-Umar clarified that the commission is not in charge of managing the pension fund assets.
“Pension fund assets are managed by the licensed PFAs and held in custody by the licensed Pension Fund Custodians (PFCs). The PFAs are responsible for investing pension fund assets in allowable asset classes, including FGN debt instruments.”
In a comprehensive report on the pension industry for the year 2021, the Director-General revealed significant insights into the pension landscape, shedding light on the financial disbursements made by the Federal Government to retirees of treasury-funded Ministries, Departments, and Agencies (MDAs) since the initiation of the Contributory Pension Scheme (CPS) in 2004 up to December 2021.
According to the report, a staggering total of N980.18 billion has been disbursed to retirees within this category over the years.
This substantial sum underscores the government’s commitment to honouring its obligations to retired civil servants and public servants who have dedicated their careers to serving the nation. Such financial support provides a crucial lifeline to retirees, ensuring they have the means to sustain themselves and their families during their post-employment years.
She emphasized that the most significant development in the pension industry in 2021 was the successful reduction of huge outstanding pension liabilities of the Federal Government and the payment of the outstanding pension to the previous Nigerian retirees.
