The National Pension Commission (PenCom) has announced plans to fully settle outstanding pension liabilities under the Contributory Pension Scheme (CPS) using a recently approved N758 billion Federal Government of Nigeria (FGN) bond. The aim is to restore confidence in the pension system and ensure timely payment of retirees’ benefits.
This is as the commission announced that the total number of program withdrawals by retirees rose to 370,568 while lump sum paid to retirees hit N1.181 trillion as of January 2025. In that same regard, monthly pension payment currently stands at N19,678.21 billion.
Speaking at a press conference in Abuja following the quarterly meeting of pension operators and regulators on Thursday, PenCom director general Omolola Oloworaran described the approval of the bond as a milestone in Nigeria’s pension administration. When raised from the capital, the funds would be used to clear all the pension liabilities from 2007 to date. She said the disbursement would commence immediately after the funds are raised through bond issuance.
She stated, “This decisive intervention by President Bola Tinubu signals a new dawn for pensioners, ensuring that the CPS fulfils its core mandate of providing timely and adequate retirement benefits.”
The approval allocates N253 billion to settle accrued pension rights for retirees of FGN Treasury-funded Ministries, Departments, and Agencies (MDAs), addressing delays caused by previous funding shortfalls. Moving forward, accrued pension rights will be included in the monthly personnel cost general warrant to ensure automatic and timely payments.
Additionally, N388 billion has been set aside to clear pension increases that have remained unpaid for nearly two decades, benefiting over 250,000 retirees. Oloworaran emphasised that this action underscores the administration’s commitment to fair and responsive pension payments.
For the first time, the FGN will contribute N107 billion to the Pension Protection Fund, ensuring that pensioners, particularly low-income earners, receive a living wage in retirement. Another N11 billion has been allocated to settle the University Professors’ Pension Shortfall, enabling eligible professors to retire on their full salary.
“With this bold step, President Tinubu has set a new standard for pension administration in Nigeria, effectively resetting the CPS on the path to sustainability,” Oloworaran noted. “However, achieving full implementation requires strategic collaboration. PenCom will continue working closely with all stakeholders to ensure the seamless issuance of the bond and the timely disbursement of pension payments.”
She further stressed that this resolution of pension liabilities restores confidence in the CPS and strengthens the pension industry for long-term growth. Beyond providing immediate relief to retirees, the move is expected to stimulate the economy, deepen the capital market, and enhance financial stability.
With this financial burden lifted, Oloworaran said the pension industry can now focus on innovation, improved service delivery, and optimizing investment returns. Expanding the Micro Pension Plan will also become a priority, ensuring that Nigerians in the informal sector can securely save for their future.
“Today, we stand at the threshold of a transformed pension industry, one that truly serves its purpose, guarantees dignity in retirement, and drives economic progress,” she concluded.
