PenCom ensures living wage for retired low-income earners
PenCom
PenCom ensures living wage for retired low-income earners
The National Pension Commission has announced plans to ensure a living wage for retired low-income earners, following the Federal Government’s approval of a N758bn pension bond to clear all outstanding liabilities under the Contributory Pension Scheme.
The Director-General of PenCom, Omolola Oloworaran, disclosed this at a press conference in Abuja on Thursday after the Quarterly PenCom/Operators Consultative Forum.
She said, “a defining milestone in our nation’s pension administration has been achieved through the approval of a N758bn Federal Government of Nigeria Bond to fully settle outstanding pension liabilities under the Contributory Pension Scheme.”
She described the bond as a major intervention by President Bola Tinubu, aimed at restoring confidence in the pension system and ensuring retirees receive their entitlements without delay.
She said N107bn from the bond had been allocated to the Pension Protection Fund, which would provide financial relief for low-income pensioners who may not have accumulated enough savings to sustain themselves in retirement.
According to her, this marks the first time the Federal Government is contributing directly to the PPF, describing it as a significant step towards strengthening pension security.
The N758bn bond, she explained, would also clear long-standing arrears, including N253bn for accrued pension rights owed to retirees from Treasury-funded Ministries, Departments, and Agencies.
She said N388bn had been earmarked to settle unpaid pension increases dating back to 2007, which would benefit over 250,000 retirees.
Oloworaran added that N11bn had been set aside to address pension shortfalls for university professors, ensuring that eligible retirees in the academic sector receive their full salaries upon retirement in line with pension reforms.
She stated, “This landmark bond resolves all accumulated pension liabilities, covering: Accrued Pension Rights – N253bn has been allocated to settle outstanding entitlements for retirees of FGN Treasury-funded MDAs, addressing the delays caused by previous funding shortfalls. Going forward, accrued pension rights will be included in the monthly personnel cost general warrant, ensuring automatic and timely payments.
“Pension Increases Since 2007 – N388bn has been provided to clear pension increases that have remained unpaid for nearly two decades. This long-overdue entitlement, benefiting over 250,000 retirees, reflects the administration’s commitment to ensuring pensions remain fair and responsive to economic realities.
“Pension Protection Fund – For the first time, the FGN is contributing N107bn to the PPF, ensuring that pensioners — particularly low-income earners —receive a living wage in retirement. This is a major step towards strengthening financial security for all retirees under the CPS.
“University Professors’ Pension Shortfall – N11bn has been allocated to fully implement the provision allowing eligible university professors to retire on their full salary, addressing the funding gaps that previously hindered its execution.”
She commended Tinubu for what she described as a bold and decisive move in pension administration, noting that the intervention had put the Contributory Pension Scheme on a sustainable path.
She assured that PenCom would work with all relevant stakeholders to ensure the smooth issuance of the bond and prompt disbursement of pension payments.
She said resolving pension liabilities would have a broader economic impact, including strengthening the financial market, boosting investment in the pension industry, and enhancing economic stability.
With the backlog addressed, she said PenCom would now focus on expanding the Micro Pension Plan, aimed at providing structured retirement savings for workers in the informal sector.
Oloworaran thanked Tinubu for prioritising pension reform and also acknowledged the 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 stability and dignity for retirees.
