The National Pension Commission (PenCom) aims to add three million funded active pension accounts within one year to enhance retirement security for more Nigerians.
Director-General Ms Omolola Oloworaran announced this at the National Pension Commission Conference and Awards in Abuja, where she outlined plans to improve pension coverage, adequacy, and compliance.
Oloworaran added that President Bola Tinubu will unveil the Pension Security Initiative on November 10, which will include the PenCare healthcare initiative and a minimum pension guarantee.
She stated that the reforms are designed to ensure Nigerians retire with dignity and financial security after their working years.
She noted that the next phase of pension reform will focus on expanding protection for Nigerians rather than solely managing assets.
She emphasised that the pension system’s success should be measured by the number of people it protects, not just the assets under management.
Oloworaran reported that pension assets increased from N20.79 trillion in July 2024 to N31.8 trillion by August 2026.
She described the N11 trillion increase over just two years as evidence of the Contributory Pension Scheme’s growth. However, identified pension coverage, benefit adequacy, and employers’ compliance with remittance obligations as major challenges facing the industry.
“For every Nigerian in the scheme, about nine remain outside. This highlights the need to extend coverage to informal sector workers.”
She identified market traders, artisans, farmers, transport workers, and young technology professionals as groups needing greater access to retirement savings.
To address the gap, Olowora said PenCom will use personal pension funds, accredited agents, and digital platforms to reach workers outside formal employment. Fund administrators had committed to opening three million additional funded active accounts within the next yeaShe emphasized that the target is for funded accounts, not just registrations, and that active contributions are essential for retirement security. Regarding pension adequacy, Oloworaran explained that the law requires combined contributions of 18 per cent of employees’ pay, with 10 per cent from employers and 8 per cent from workers. She noted that some private-sector employers use narrow definitions of pensionable earnings, leading to inadequate retirement benefits. She stated that nearly 70 per cent of private-sector employees retire with pensions below the national minimum wage.
She added that over 55 per cent of retirees receiving pensions below the minimum wage are from the private sector.
Oloworaran urged employers to calculate pension contributions fairly and support the Pension Protection Fund to strengthen the minimum pension guarantee.
She also called on pension operators to deliver returns above inflation, noting that investment performance directly affects retirees’ purchasing power.
The PenCom director-general warned employers not to deduct workers’ pension contributions without remitting them, calling it an offence against employees’ future financial security. PenCom also said it would use powers under the Pension Reform Act to recover outstanding contributions owed to workers.
Oloworaran added that the commission will require pension fund administrators and custodians to complete recapitalisation by June 30, 2027.
She said this will strengthen the industry’s ability to safeguard pension assets and diversify investments. The director-general noted that Nigeria’s pension assets are still small relative to the economy, indicating significant growth potential. or growth.
She cited Australia’s retirement savings system as an example of how consistent contributions can generate substantial long-term capital.
She also referenced Chile’s pension reforms, stressing that retirement savings must provide adequate benefits to maintain public confidence.
Oloworaran said pension funds can support infrastructure, housing, power, and enterprise development if investments remain prudent, transparent, and focused on contributors’ interests.
“Pension money is not government money; it is the deferred wages of Nigerian workers,” she said. She urged federal and state governments to remit pension contributions promptly, fund accrued pension rights, and ensure all states join the CPS.CPS.
She called on organised labour, employers, pension operators, and development partners to support efforts to expand pension coverage and improve retirees’ welfare.
Earlier, PenCom Commissioner Mr Bello Malabu said regulators, employers, pension operators, and development partners play key roles in building an inclusive and sustainable pension system.
Malabu, also chairman of the conference planning committee, commended Oloworaran, the commission’s management and staff, and industry stakeholders for supporting the eventHe acknowledged the contributions of the Pension Industry Leadership Council, the Pension Fund Operators Association of Nigeria, and other development partners. Malabu said the value of a pension system should be measured not only by assets managed but also by the financial security, dignity, and confidence it provides to retirees.
The News Agency of Nigeria (NAN) reports that the conference and awards were organised to strengthen collaboration and advance pension coverage and retirement security in Nigeria.
