Employers Fail To Enrol 73.23m Workers For Contributory Pension Scheme

No fewer than 73.23 million workers in Nigeria’s public and private sectors are being disenfranchised by their employers from having a good life in retirement, LEADERSHIP can exclusively reveal.

Latest data released by the pension industry regulator, the National Pension Commission (PenCom), and accessed by LEADERSHIP, revealed that only 10.92 million workers from the public and private sectors have so far joined the new pension scheme, known as the Contributory Pension Scheme (CPS), out of 84.15 million workers across the country.

Earlier, the 2024 Nigeria Labour Force Survey (NLFS), released by the National Bureau of Statistics (NBS), showed that as of late 2023, Nigeria had approximately 84.15 million employed persons—a figure that may have increased over the last two years by the time a new figure is released next year.

PenCom data shows that 10.92 million workers have been registered by their employers under the CPS; hence, the Pension Fund Administrators (PFAs) have opened a Retirement Savings Account (RSA) for each of them, into which their employers contribute monthly.

Under the CPS, only employers can register their employees, as no worker can be enrolled without employer input, and any company with three or more staff members is required to join the scheme.

The roughly 11 million workers covered so far have joined between 2004, when the scheme was established, and September 2025, showing that approximately 500,000 workers joined the scheme annually over the last 20 years.

Under the Pension Reforms Act (PRA) 2014, the minimum total contribution is 18 per cent of an employee’s gross emoluments, split into 10 per cent from the employer and 8 per cent from the employee, contributed monthly to the employee’s RSA. Both parties can agree to increase these rates, with the employer potentially covering the entire minimum 18 per cent or adding extra, while employees may also make additional voluntary contributions (VCs) to boost their savings.

However, some employers already in the scheme have been defaulting by failing to remit either the workers’ portion, the employer’s portion, or both. PenCom has penalised these defaulters to the tune of about N15 billion, having also compelled them to pay N15 billion in outstanding contributions owed to workers.

LEADERSHIP’s findings revealed that many employers of the 73.1 million unregistered workers are trying to cut costs, as some struggle to pay salaries and meet other financial obligations. Adding pension contributions, they felt, would further increase their operating costs, prompting them to remain outside the scheme.

Some employers, it was gathered, simply exempt workers in order to maximise profits.
A pension scheme, after retirement, is meant to pay workers a monthly pension as if the beneficiary were still in service, enabling him or her to meet day-to-day expenses without relying on others for financial support.

This ensures a fulfilled life in retirement, unlike those who may have to live from hand to mouth to eke out a living.

Meanwhile, the nation’s pension fund assets rose by N194 billion, climbing from N25.895 trillion in August 2025 to N26.089 trillion in September 2025, PenCom data reveals.

In the previous month, the fund had risen from N25.797 trillion in July 2025 to N25.895 trillion in August 2025, an increase of N98 billion.

According to LEADERSHIP’s checks, investment income was instrumental to the continuous growth of pension funds, despite the fact that some governments—mainly at the state level—are not paying their workers’ monthly pension contributions as and when due.

Similarly, the significant increase, according to findings, was attributed to new pension contributions received, interest from fixed-income securities, and net realised gains on equities and mutual fund investments.

Reacting to this development at separate fora in Lagos, pension industry stakeholders agreed that there is a need for increased advocacy to convince employers to bring their employees on board. They called for intensified enforcement of the PRA 2014 to reduce the rate of default and ensure workers have peace of mind at retirement, knowing there is a fund set aside to cater for them in their post-work years.

For her part, the director-general of PenCom, Ms Omolola Oloworaran, said the regulatory body has intensified efforts to bring into the scheme those who are not yet enrolled at the federal, state, and local government levels, as well as companies in the private sector of the nation’s economy.

As part of activities to strengthen the pension framework, expand its impact, and deepen adoption, she said PenCom has reviewed the pension industry investment guidelines such that PFAs can now invest pension funds in infrastructure and private equity.

Oloworaran said this development will ensure that pension contributors receive good returns on their investments, while the pension assets themselves deliver real economic impact.

She also disclosed that the Micro Pension Plan (MPP) had been renamed the Personal Pension Plan to broaden adoption, as the plan was not limited to those engaged in micro-businesses alone but to entrepreneurs generally who had not registered under the main pension scheme.

Similarly, the Head of Operations, Parthian Pensions Limited, Mr Adetunbi Ashaye, called on stakeholders in Nigeria’s pension sector to educate Nigerians on the importance of subscribing to the CPS.

Highlighting developments in the industry that demonstrate its growth potential, he said: “What really needs to happen is the drive for financial literacy because people in Nigeria see pension as insignificant, something that is not important.

“The impact of the scheme on the economy is ensuring that people have good retirement; that people have a good life after they have stopped working. In other words, what we need to do in the industry as operators is to ensure financial literacy. We need to let people know what is going on and why they should continually support the contributory pension scheme,” he added.

However, the executive secretary/CEO of the Pension Fund Operators Association of Nigeria (PenOp), Oguche Aguda, has applauded the contributions of pension fund operators toward growing the assets,and gave assurance contributors that their funds are in safe hands, noting that there has been no reported mismanagement of pension funds under the new scheme.

He disclosed that operators had increased advocacy and marketing of the scheme to bring new contributors on board.