The Federal Government has successfully cleared inherited pension liabilities that had piled up since 2007, utilizing a N758 billion intervention bond to ensure that 957,045 retired workers receive their long-overdue entitlements.
According to a report by Punch, the Director-General of the National Pension Commission, Ms Omolola Oloworaran, disclosed this while delivering her keynote address, titled ‘From Reform to Reality: Renewed Hope, Pension Security for All Nigerians’, at the 2026 PenCom Media Conference in Lagos on Tuesday.
Oloworaran said the settlement marked a significant break from the prolonged accumulation of pension liabilities inherited across successive administrations, stressing that the government had chosen to fulfil its obligations to retired workers.
“The Federal Government cleared all inherited pension liabilities, some dating back to 2007. These obligations passed through multiple administrations, but this government chose to settle them. That is statesmanship, a debt paid, not just a promise.
“Every nation makes a promise to the people who build it—those who serve faithfully and diligently. When your working years are done, your country should not forget you. For too long, that promise was kept slowly, partially, or not at all. Today, I can report that this has changed—not in aspiration, but in fact.”
She said the clearance of the legacy debts was part of wider reforms being implemented by the commission under the administration of President Bola Tinubu.
According to her, the government has also taken steps to prevent the accumulation of fresh pension arrears, including the early crediting of accrued pension rights for federal workers expected to retire up to December 2029.
She said the credits were made directly into the workers’ Retirement Savings Accounts after a comprehensive one-time verification and enrolment exercise.
PenCom has also introduced a Zero Waiting Time Policy designed to synchronise retirement benefit payments with the monthly salary cycle of public servants.
The policy, according to the commission, is intended to ensure that workers do not experience financial gaps when they leave active service, while the time required to process pension benefits has been reduced from as much as 21 months to 48 hours.
Oloworaran also spoke on the commission’s efforts to improve pension awareness and extend its reach to more Nigerians.
“PFAs, I believe, understand the need for awareness. And there’s a plan; as part of the initiatives being worked on by the Pension Industry Council, we do have a stakeholder management and advocacy committee. And they’ve come up with a calendar of activities in terms of how to engage Nigerians and ensure pension literacy as well as pension awareness.
“If you listened earlier on, part of what will also be happening during the Pension Week is also awareness, adequacy, state visits, and engagement. I know that we need to do a whole lot around that, and the pension industry is working to ensure that they can reach, if not every Nigerian, at least most Nigerians. So, work is ongoing in that regard. We do have a lot to do, and we recognise that, both at the industry level and also in PenCom as well.”
On efforts to extend the Contributory Pension Scheme to more states, the PenCom boss said discussions were ongoing with state governments, while attention was also being given to the adequacy of retirement benefits.
“We are engaging states. We are engaging states on various levels. Number one: get onboarded onto the Contributory Pension Scheme.
“And then, number two: the conversation we are having with people who are now part of the scheme is the question of adequacy, on how we can benchmark what is being paid to retirees so that, you know, when we have inflation, there can be a balance. So, we want to see increments that match inflation or at least compensate for inflation. So, we are having two conversations, like I said: one, get onto the CPS; and two, on adequacy.”
The conference also highlighted measures aimed at improving the financial position of retirees under existing pension arrangements.
Among them was a statutory review of payments to retirees of the defunct Nigeria Social Insurance Trust Fund, which covered a 21-year period.
The review resulted in an average 1,173 per cent increase in payments to 2,116 NSITF retirees, while N8.7 billion in outstanding arrears was also settled.
PenCom further disclosed that Pension Boost 1.0 had increased monthly payments under the Contributory Pension Scheme from N12.15 billion to N14.83 billion, benefiting more than 241,000 retirees across the country.
Oloworaran said the treatment of pensioners should remain a key indicator of a government’s commitment to worker welfare, noting that its responsibility to employees extends beyond their years in active service.
The commission also announced plans for additional welfare interventions, including the PenCare free healthcare programme, which will initially target 30,000 low-income retirees.
Other planned measures include the implementation of a statutory Minimum Pension Guarantee and an expansion of the Micro Pension Plan through a nationwide network of agents targeting traders, artisans and other workers in the informal economy.
The Director of the Personal Pension Plans Department at PenCom, Dr Babatunde Alayande, also used the conference to highlight the commission’s strategy for extending pension coverage to self-employed and informal sector workers.
Presenting a paper titled ‘Expanding Pension Coverage to the Self-employed and Informal Sector Workers: The Journey So Far’, Alayande said the informal economy accounted for about 93 per cent of Nigeria’s workforce, representing approximately 84.92 million workers.
Despite contributing between 58 and 65 per cent of the country’s Gross Domestic Product, he said pension coverage among informal workers remained extremely low.
As of July 2026, only 242,690 people in the sector were enrolled in the Personal Pension Plan, leaving a coverage gap of 99.71 per cent.
Alayande noted that women were particularly affected, with 96 per cent of employed women working in the informal sector.
He explained that the Personal Pension Plan, established under Section 2(3) of the Pension Reform Act 2014, provides a flexible retirement savings option for self-employed people, traders, artisans, farmers, gig workers, formal-sector employees, foreign contributors and minors through voluntary parental registration.
“The plan allows flexible daily, weekly, or monthly contributions via USSD, mobile money, or direct bank transfers, requiring minimal onboarding documentation of just a phone number and a National Identification Number. Contributions are split equally into a 50 per cent contingent portion, withdrawable three months after the initial deposit and once every two months thereafter, and a 50 per cent retirement benefits portion accessible at age 50 or upon medical incapacitation”, Alayande said.
To improve access in underserved communities, PenCom accredited six Accredited Pension Agents in 2026: Awabah Remit Services Limited, e-Tranzact International Limited, NextAutomate APA Limited, SunTrust Bank Nigeria Limited, PrimeTrust APA Limited and Majestic APA Limited.
Alayande, however, stressed that increasing registrations alone would not guarantee effective pension coverage.
“Access does not automatically lead to active saving”.
He added, “Registrations are not the measure of success”.
According to him, building confidence in the pension system and encouraging sustained contributions remain crucial to achieving meaningful retirement security.
“Confidence in long-horizon institutions is not automatic and must be earned”.
He further warned that pension accounts that become inactive after registration would do little to secure the future of contributors.
“Each stage can fail independently. A registered account that never receives a second contribution adds nothing to retirement security”.
To tackle the challenges, PenCom is pursuing strategies including multilingual public awareness campaigns, simpler digital registration processes, gender-sensitive products, Sharia-compliant pension options and partnerships with development organisations.
The Chairperson of the Nigerian Association of Insurance and Pension Editors, Ebere Nwoji, commended Oloworaran for what she described as her commitment to improving the welfare of retirees.
“You have done this by your determination, zeal, and your decision to roll up your sleeves and do the job that you are appointed to do.
“And in doing this, I must say in my own assessment, you have sincerely displayed a high sense of intellectual prowess and understanding of the financial sector. And your passion and love for the pensioners in Nigeria, by the way you handled the affairs of the National Pension Commission.”
Also speaking, Nigeria Labour Congress representative Iwa Iko described himself as both a beneficiary and one of the pioneers of Nigeria’s contributory pension system.
“I can say that I’m the face of the Contributory Pension Scheme, because I was a member of the Chief Fola Adeola Committee that put up the architecture for modern-day pension reforms in Nigeria, and also put forward the draft of what became the Pension Reform Act 2004.
“And I retired as a Director in the Federal Public Service under the Contributory Pension Scheme. So, all that the DG was saying is that I will stand with her anywhere to debate with anybody.”
Iko also pointed to the impact of the recent pension review on his personal benefits.
“Because I have also been receiving alerts of N32,000. And when the review took place, I showed my wife the first alert we got as a result of the review of the pensions of CPS retirees.”
What You Should Know
The federal administration has cleared a massive backlog of pension liabilities accumulated over nearly two decades, bringing financial relief to nearly a million retired workers across the country. Led by the National Pension Commission (PenCom), the government is also introducing structural reforms like the Zero Waiting Time Policy to fast-track retirement benefit payouts.
- Positive Impact: Retirees will experience significantly shorter processing times for their benefits, dropping from months of waiting down to 48 hours, while informal workers and low-income pensioners stand to benefit from new health and micro-pension initiatives.
- Potential Concerns: Despite clearing legacy debts, maintaining long-term pension adequacy against inflation and successfully expanding the Contributory Pension Scheme into the vast informal sector remain significant operational hurdles for PenCom.
