The National Pension Commission (PenCom) has described Nigeria’s 2004 pension reform as one of the most significant and enduring transformations in the country’s financial sector, saying the reform has continued to deepen under successive administrations.
The Head of the Corporate Communications Department, PenCom, Mr Ibrahim Buwai, stated this at the 36th Annual Conference of the Finance Correspondents Association of Nigeria (FICAN), held at the weekend in Lagos.
The conference, with the theme, “Building on the Gains of Recapitalisation, Tax Reforms and the Fintech Revolution,” brought together financial journalists, regulators, policymakers and other stakeholders to examine major developments shaping Nigeria’s financial and economic landscape.
Buwai said the pension reform, which commenced in 2004, had remained one of the country’s most sustained financial-sector reforms, despite challenges encountered over the years, particularly delays in the payment of pension obligations in the public sector.
He said, “Since 2004, when Nigeria embarked on pension reform, to the present administration, the reform has been sustained and deepened. The reform is one of the enduring reforms in the financial sector.
However, we have also encountered challenges relating to delayed payments in the public sector.”
According to him, the pension sector has recorded a significant turnaround, moving from a position of deficit to surplus, while the Federal Government has made substantial progress in settling the accrued pension rights of retiring public servants.
Buwai disclosed that the Federal Government was currently 41 months ahead in the payment of accrued pension rights, indicating that pension liabilities due to federal government employees retiring up to December 2029 had been provided for.
“Today, we are 41 months in surplus. This means that we have paid the accrued pension rights of federal government employees due to retire up to December 2029,” he said.
He identified the recent payment of additional benefits to retired federal civil servants as another significant development in the implementation of the pension reform.
Buwai explained that the Contributory Pension Scheme (CPS) had not abolished gratuity or prevented employers from granting additional retirement benefits to their workers.
He cited Section 4 of the Pension Reform Act, which provides for additional benefits where employers are able and willing to provide such benefits in accordance with the law.
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