• Oloworaran forecloses June 2027 recapitalisation deadline for pension administrators, custodians
• Laments 70% of private sector retirees earn below minimum wage, risk poverty
•PenCom targets 3 million funded pension accounts
Olawale Ajimotokan and James Emejo in Abuja
President Bola Tinubu has assured Nigerian retirees that no citizen who served the country will be forgotten in retirement, declaring that his administration is committed to restoring dignity and financial security to pensioners through the N758 billion Federal Government Pension Bond and other pension reforms.
Tinubu gave the assurance yesterday at the inaugural National Pension Week Leadership Summit in Abuja, where he reaffirmed his administration’s commitment to addressing outstanding pension obligations and improving the welfare of retirees.
That was as Director-General of National Pension Commission (PenCom), Ms Omolola Oloworaran, ruled out any extension of the June 30, 2027 recapitalisation deadline for Pension Fund Administrators (PFAs) and Pension Fund Custodians (PFCs).
Oloworaran urged operators to strengthen their financial capacity or risk falling short of the regulator’s requirements.
Speaking at the summit, she stressed that the commission would not shift the deadline, adding that the next phase of pension reform would prioritise institutional resilience, stronger investment performance, and improved retirement benefits over the growth in industry assets alone.
Tinubu, who was represented at the summit by Secretary to the Government of the Federation (SGF), Senator George Akume, said pension benefits were not privileges granted by the government, but entitlements earned through years of service to the nation.
He stated, “A pension is not a favour granted by government. It is a wage earned, deferred and held in trust. It is a promise. And this administration has resolved that the promise will be kept.”
The president said his administration inherited pension obligations that had remained unsettled for years, leaving many retirees waiting for their accrued pension rights.
He maintained that the approval of the N758 billion Federal Government Pension Bond was a major step towards settling the outstanding obligations and strengthening the Pension Protection Fund.
Tinubu said, “That was not an accounting exercise. It was an act of restitution to Nigerians who served their country and were made to wait for what they had earned.”
The president added that the bond formed part of broader efforts to restore confidence in the Contributory Pension Scheme and ensure that workers who devoted their productive years to national service could retire with greater peace of mind.
He also announced that his administration would implement the Minimum Pension Guarantee provision of the Pension Reform Act 2014, which he stated had remained unimplemented since the law was enacted more than 11 years ago.
“Since enactment, that promise has never been honoured. Under President Tinubu, it will be,” he said.
Tinubu unveiled PenCare, a national retiree wellbeing programme designed to provide low-income retirees with access to essential healthcare services, signalling a broader approach to retirement security beyond the payment of pension benefits.
He said a sustainable pension system must protect retirees against financial hardship while ensuring that their healthcare and welfare needs received adequate attention.
The president stressed that achieving the objectives required the cooperation of all stakeholders in the pension industry.
He charged the National Pension Commission (PenCom) to enforce pension laws without fear or favour, while urging public and private sector employers to remit pension contributions fully and promptly.
“To deduct a worker’s contribution and fail to remit it is not an administrative lapse. It is a breach of trust,” he warned.
He also called on Pension Fund Administrators and Custodians to improve their investment strategies, reduce costs and ensure that retirement savings delivered meaningful returns to contributors.
According to him, pension fund investments must balance the security of contributors’ savings with disciplined growth, particularly in an economy where inflation can erode the purchasing power of retirement benefits.
Tinubu directed a renewed push to extend pension coverage to workers in the informal sector, including traders, artisans, farmers, transport workers, and self-employed Nigerians, through the Personal Pension Plan and improved distribution channels.
He urged state governments, organised labour, and other stakeholders to work towards expanding pension coverage, improving compliance, and accelerating the payment of retirement benefits.
The president stated that the success of the reforms would ultimately be measured by the level of security and dignity delivered to pensioners, rather than the volume of assets accumulated by the pension system.
He said, “The true measure of our success will not be how much money the system holds. It will be how much security, and how much dignity, it delivers.”
Tinubu declared, “Above all, no Nigerian who has served this nation will be forgotten in retirement. Nigeria will keep faith with those who kept faith with Nigeria.”
For her part, Oloworaran said, “We are not changing our minds,” insisting that operators must demonstrate the financial strength required to safeguard the retirement savings of millions of Nigerian workers.
“Size is what we have achieved. Strength is what we now demand,” she added.
The recapitalisation drive comes as PenCom confronts persistent weaknesses in pension adequacy, with almost 70 per cent of private-sector employees retiring on pensions below the national minimum wage, exposing a gap between years of employment and financial security in old age.
Oloworaran disclosed that more than 55 per cent of retirees receiving pensions below the minimum wage came from the private sector, describing the situation as unacceptable and calling for a broader review of how retirement benefits were funded.
She said, “Our private sector workers are retiring into poverty. This must change.”
She attributed the problem, partly, to the calculation of pension contributions on pensionable earnings rather than workers’ full emoluments, a practice that can leave retirement savings significantly below what employees’ actual earnings might support.
Under the existing framework, employers contribute 10 per cent of pensionable pay while employees contribute eight per cent, bringing the statutory rate to 18 per cent.
However, Oloworaran pointed out that the contribution base, alongside investment performance and compliance failures, affected the adequacy of benefits ultimately paid to retirees.
She urged private-sector employers to take greater responsibility for protecting workers’ retirement incomes, including supporting the Pension Protection Fund, which already receives contributions from the federal government and the pension industry.
According to her, the cost of providing a minimum pension guarantee should not rest solely on public resources when private businesses also benefit from workers’ labour.
She added that PenCom would deploy the enforcement provisions of the Pension Reform Act to recover unpaid contributions and sanction employers who deduct pension contributions from workers’ salaries without remitting them.
She warned that such defaults undermined workers’ future financial security and would not be treated as mere administrative lapses.
Beyond compliance, the commission expects pension operators to generate returns that preserve the purchasing power of retirement savings, particularly as inflation erodes the value of accumulated contributions.
Oloworaran said pension performance must be assessed by the real returns delivered to contributors rather than nominal gains that fail to keep pace with rising prices.
Targets Three Million Funded Accounts
In a parallel push to expand pension coverage, PenCom secured commitments from PFAs to open three million additional funded and active pension accounts within one year, targeting Nigerians outside the formal payroll system.
The initiative is expected to bring more traders, artisans, farmers, transport operators and other self-employed workers into the Contributory Pension Scheme (CPS) through personal pension plans, accredited pension agents, and digital onboarding platforms.
Oloworaran stressed that the target was not simply to register new participants but to ensure that contributions actually flowed into their accounts.
“An empty account is a statistic, but a funded account is a future,” she said.
She stated that Nigeria continued to face a substantial pension coverage gap, with roughly nine Nigerians outside the scheme for every one covered, leaving millions exposed to financial insecurity in old age.
The proposed expansion would shift the scheme beyond its traditional concentration on salaried workers, enabling participation by people whose livelihoods are not tied to formal employment.
Minimum Pension Guarantee, PenCare Set for November
Oloworaran also said Tinubu was expected to launch a Pension Security Initiative on November 10, subject to the programme proceeding as scheduled.
The initiative is expected to include the minimum pension guarantee and PenCare, a healthcare programme designed to improve medical access for retirees.
She said the minimum pension guarantee, provided for under Sections 82 and 84 of the Pension Reform Act 2014, should no longer remain an unfulfilled commitment, particularly for vulnerable pensioners struggling to meet essential living costs.
The objective, she explained, was to provide a measure of protection for retirees who risk choosing between food and medication because of inadequate pension payments.
However, she acknowledged the importance of sustainable funding and wider stakeholder participation in ensuring that the proposed safety net delivered meaningful support.
PenCom is also seeking to deepen the role of pension assets in financing infrastructure, housing, power and enterprise, while maintaining strict safeguards for contributors’ funds.
Oloworaran said industry assets had increased from N20.79 trillion in July 2024 to N31.8 trillion at the end of August 2026, an increase of about N11 trillion in just over two years.
She stated that the accumulation of assets must translate into stronger retirement outcomes, adding that pension funds could support national development only where investments met appropriate risk and return requirements.
She said, “Pension money is not government money. It is not industry money. It is the deferred wages of Nigerian workers.”
She maintained that the protection of contributors’ savings must take precedence over broader development objectives, even when pension investments were deployed to support economic growth.
The commission is also pressing for improved compliance among employers and state governments, including wider adoption of the Contributory Pension Scheme by states.
Oloworaran called on operators, employers, labour unions, and governments to support the reforms.
She said a stronger pension industry must deliver both wider coverage and adequate benefits rather than merely report rising assets under management.