- Accrued Pension Rights: The federal government’s failure to pay accrued pension rights has put pressure on Pension Fund Administrators (PFAs), affecting retirees who are yet to access their pensions since 2022 .
- Impact on Retirees: The delay has led to untimely and preventable deaths among retirees, as they are deprived of access to healthcare .
- Causes of Delay: Section 2.3 of the Revised Regulation on the Administration of Retirement/Terminal Benefits states that PFAs cannot compute and pay retirement benefits without accrued rights from the federal government .
- Possible Solutions: Experts recommend establishing a dedicated pension reserve fund, insulated from government budgetary constraints, and introducing special levies or taxes dedicated to pension funding .
- Legislative Action: There is a need for legislation to mandate regular contributions to the pension reserve fund and ensure accountability in pension funds management and disbursement .
- International Best Practices: Pension reserve funds can be effective in addressing pension obligations, as seen in other countries .
Protesting federal government pensioners have taken a bold step by shutting down the Federal Ministry of Finance over unpaid accrued pension rights. Comrade Sylva Nwaiwu, National Chairman of the National Union of Contributory Pensioners, led the senior citizens to the ministry, demanding the immediate release of their accrued rights .
These accrued rights refer to pension entitlements under the old scheme, which existed before the Contributory Pension Scheme was introduced by the Federal Government in 2004. According to the Pension Act, all pension entitlements before 2004 were meant to be paid to the Pension Fund administrators of each federal government worker upon retirement .
However, Comrade Nwaiwu revealed that many of his members who retired since 2003 were yet to receive these entitlements, which has prevented them from accessing their accounts from the Pension Administration System (PASS). This issue has been ongoing, with the federal government last paying accrued pensions in 2022, releasing N13.89 billion covering a four-month payment period .
The delay in paying accrued rights has significant consequences, including increased pressure on Pension Fund Administrators (PFAs) and a rise in untimely deaths among retirees due to lack of access to healthcare . To address this issue, experts recommend establishing a dedicated pension reserve fund specifically for accrued rights payments, insulated from other government budgetary constraints and competing priorities .
