October 18, 2021


documenting the nigerian story…

FG to pay pension arrears of retired civil servants

President Muhammadu Buhari has approved the payment of some critical aspects of the outstanding pension liabilities of the federal government under the Contributory Pension Scheme (CPS) since July 2014.

A statement by the National Pension Commission (PenCom) Wednesday, said Buhari approved the payment of outstanding accrued pension rights for verified and enrolled retirees of treasury-funded Ministries, Departments and Agencies (MDAs) that retired but are yet to be paid their benefits.

It also consists of the backlog of death benefits claims due to beneficiaries of deceased employees of treasury funded MDAs.

On April 14, 2021, the Director General of PenCom, Aisha Dahir-Umar, told the members of the visiting Senate Committee on Establishment & Public Services that a large number of federal government employees who retired from March 2020 to March 2021 under the CPS were yet to receive their pensions due to non-payment of their Accrued Pension Rights.

She traced the issue to 2014 due to “the appropriation of insufficient amounts for payment of Accrued Pension Rights of Federal Government of Nigeria (FGN) retirees and further aggravated by late or non-release of full appropriated amounts.”

As at 2019, PenCom estimated it would require over N62 billion to clear backlog of Accrued Pension Rights and in line with the Commission’s request, President Buhari had then directed the Minister of Finance, Budget and National Planning, Zainab Ahmed, to release N62.83bn to clear the liabilities in 2020, 2021 and 2022.

The president also granted approval to clear the backlog of the Accrued Pension Rights, the president also authorised the payment of 2.5 percent differential in the rate of employer pension contribution for federal government retirees and employees, which resulted from the increase in the minimum pension contribution for employers from 7.5% to 10% based on the Pension Reform Act (PRA) 2014.

PenCom said remittance into the various Retirement Savings Accounts (RSAs) of the affected retirees and employees is currently being processed.