173,209 Retirees To Benefit From FG’s N52,500 Minimum Pension—PenCom

…FG Sets Aside N400bn Fund To Guarantee Minimum Pension

The Federal Government has introduced a minimum pension guarantee of N52,500 for eligible retirees under the Contributory Pension Scheme (CPS), with 173,209 pensioners expected to benefit from the initiative.

The Director-General of the National Pension Commission (PenCom), Omolola Oloworaran, disclosed this on Tuesday at the launch of the Presidential Pension Security Initiative in Abuja.

Before the new N52,500 minimum pension guarantee, there was no officially implemented nationwide Minimum Pension Guarantee under the Contributory Pension Scheme.

However, some retirees were receiving monthly pensions of just above N20,000, according to PenCom DG.

She said the Federal Government had established a N400bn Pension Protection Fund to finance the minimum pension guarantee, describing the initiative as a landmark intervention aimed at protecting retirees whose monthly pension payments fall below the approved threshold.

According to her, the amount was determined through actuarial assessment and would be subject to periodic review.

“The figure was not plucked from the air; it has been validated by an actuary, and it is subject to review. And it is funded,” she said.

Oloworaran said the initiative would address a longstanding provision of the pension reform framework that had remained unimplemented for 22 years because of the absence of dedicated funding.

She noted that the promise of a guaranteed minimum pension was introduced under the 2004 pension reform but successive administrations had failed to provide the financial backing required to implement it.

“That promise has been the law of this land for 22 years. In those years, this republic has been led by five presidents. The promise stayed on paper because no one put money behind it,” she said.

The PenCom chief said the introduction of the guarantee under President Bola Tinubu’s administration would provide financial relief to thousands of retirees struggling to meet basic living expenses.

She disclosed that the 173,209 prospective beneficiaries comprised 34 per cent who retired from the Federal Government service, 12 per cent from state governments and 54 per cent from the private sector.

She expressed concern that more than 65 per cent of private-sector retirees currently receive pensions below the minimum threshold, making them particularly vulnerable to economic hardship.

Oloworaran consequently called on private-sector employers to contribute to the Pension Protection Fund, arguing that businesses should share responsibility for protecting workers who devoted their productive years to building their organisations.

“The Federal Government has put its money into this fund. The pension industry has put its money into this fund as well. The offering basket for the Pension Protection Fund is now on the private sector’s table. Please do not let it pass empty. Contribute to the Pension Protection Fund,” she said.

Beyond the minimum pension guarantee, the PenCom director-general announced that the pension industry had committed more than N7bn towards providing healthcare support for low-income retirees.

She said the funding had already supported the payment of health insurance premiums for almost 30,000 retirees under the PenCare initiative, with the remaining balance retained in the dedicated account.

According to her, the healthcare intervention was designed to prevent vulnerable pensioners from having to choose between purchasing essential medication and meeting their daily food needs.

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Illustrating the plight of low-income retirees, Oloworaran narrated the experience of an elderly woman who could not afford to purchase prescribed medication because doing so would leave her without enough money to buy food.

“Months ago, a doctor wrote her a prescription. What did she do? She folded the prescription and put it in her purse. Because if she buys the medicine, she may not be able to eat. Two burdens: her income, her health,” she said.

She said the combination of the minimum pension guarantee and healthcare support would ensure that vulnerable retirees could access both financial assistance and medical services.

“She will walk into a hospital, and nobody will ask her for money. She will take that prescription out of her purse, and this time she will fill it. She will buy her medicine, and she will eat. She will never again have to choose,” Oloworaran said.

The PenCom boss also disclosed that the Federal Government had made significant progress in clearing outstanding pension liabilities inherited by state governments.

She said the states had accumulated more than N2tn in legacy pension obligations when the current administration assumed office, adding that N1.07tn had so far been cleared.

According to her, 13 states are now free of outstanding legacy pension obligations, either because they had no inherited liabilities or had settled their obligations or paid at least 80 per cent of the amounts due.

She attributed the progress to reforms introduced by the Tinubu administration, which she said had improved the capacity of states to address outstanding pension obligations.

Oloworaran further announced plans to expand pension coverage to millions of Nigerians working in the informal sector, including market women, artisans, farmers and other self-employed workers.

She said PenCom had introduced accredited pension agents who would take the scheme to markets, motor parks and communities across the country.

She added that the commission was working on sustainable incentives to encourage informal-sector participation, with a target of extending pension coverage beyond the formal workforce.

“We have unlocked accredited pension agents to carry this scheme through your streets to every corner of this nation, and the president has requested us to create sustainable incentives that will bring the informal sector into the scheme, not in the thousands, but in tens of millions,” she said.

On investment, she said the pension industry was also positioning itself to support infrastructure development through long-term capital commitments.

She disclosed that the industry was committing $100m, while another $50m would be sourced from development partners for the proposed infrastructure investment programme.

The deployment of the funds, she said, was expected to commence before the end of the first half of 2027.

Oloworaran said the broader objective of the Presidential Pension Security Initiative was to ensure that Nigerians who contributed to national development during their working years could enjoy financial security and access to essential services after retirement.

She described the initiative as more than an institutional reform, saying it was intended to restore confidence in the country’s pension system.

“Let no one call this merely a turnaround of the pension system. A turnaround repairs an institution. This is a redemption. It redeems a promise. It redeems a generation. It redeems the word of the Nigerian state,” she said.

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