National Pension Commission Drives Adoption of Contributory Pension Schemes
The National Pension Commission (PenCom) is actively working with state and local governments, as well as public sector employers, to fully embrace contributory pension schemes. Ebele Nwozi reports on the ongoing initiatives to enhance pension coverage across Nigeria.
Penned Strategy Targeting Universal Pension Coverage
One of the key priorities for PenCom’s current leadership is to enroll all Nigerians with reliable income into the Contributory Pension Scheme (CPS). The aim is to ensure that every citizen can retire with dignity, anticipating regular benefit payments from their retirement savings accounts managed by various pension fund managers, irrespective of their employment status—be it in government, private sector, or as independent contractors.
Leading the Charge for Change
Executive Director Ms. Omolola Oloworaran remains relentless in her pursuit of this vision, committed to using every means necessary to achieve success. Under her leadership, PenCom has initiated a range of reforms and initiatives, notably the “Pension Revolution 2.0,” launched in mid-2025, intended to reshape the pension landscape.
Building Collaborative Frameworks
As part of these reforms, PenCom collaborates with relevant organizations to encourage workers to increase their savings and aid employers in improving benefit payments for retirees. Ms. Oloworaran has instituted biannual roundtables involving leaders from the Pensions Leadership Council (PILC) and the Trades Union Congress (TUC). These gatherings aim to unify workers and employers within the CPS framework while advocating for enhanced retirement payments.
Innovative Pension Reforms in Action
The strategic roadmap established by PenCom includes deepening pension participation among Nigerians while maximizing the efficiency of pension funds for infrastructure development, all without compromising retirement security. Notably, the commission has revamped its micro-pension schemes, now described as personal pension schemes, to appeal more to informal sector workers such as artisans and tradespeople.
Addressing Compliance Challenges at State and Local Levels
A significant challenge for PenCom remains the integration of state and local government employees into the CPS, as the commission currently lacks the necessary enforcement powers due to existing legal frameworks. Despite this, 24 out of 36 states have enacted laws aligned with the Pension Reform Act of 2014, a crucial step toward broader CPS adoption. However, many states continue to operate outside of this framework, opting for systems that avoid the regulatory scrutiny from PenCom.
Efforts to Enhance Compliance Among Formal Sector Employers
While PenCom has made strides in expanding coverage, compliance within the formal sector remains an ongoing hurdle. During a recent meeting with the TUC, Ms. Oloworaran expressed concern over persistent non-compliance by some employers. She underscored the necessity of accountability and stated that employers failing to establish pension schemes for employees would face increased scrutiny and potential penalties.
Advocacy for Legislative Support on mandatory CPS Adoption
Industry analysts are advocating for the Senate to consider mandatory involvement of state governments in the CPS during discussions on recent amendments related to pensions and health care. They argue that legislative changes are essential to rectify the current scenario where certain state employees retire without pensions, leaving them vulnerable. The call for an overhaul highlights the pressing need for systemic reforms to prevent further pension-related issues in Nigeria.
