The Ogun State Government has reaffirmed its commitment to improving the welfare of workers and retirees under the Contributory Pension Scheme (CPS) with the approval of an Additional Pension Benefit (APB) aimed at enhancing retirement security and closing existing gaps in the scheme.
The development was disclosed during a meeting chaired by the Commissioner for Finance and Chief Economic Adviser, Mr Dapo Okubadejo, following strategic engagements between the State Government, labour unions, Pension Fund Administrators (PFAs), and members of the Pension Fund Management Committees.
|
|
Speaking at the meeting, the commissioner emphasised that compliance with the CPS law is both mandatory and beneficial to employees and the State. He explained that the Defined Benefit Scheme (DBS) and the CPS are fundamentally different, stressing that the administration of Dapo Abiodun remains committed to addressing identified gaps in order to safeguard workers’ interests.
He disclosed that the governor had approved the introduction of the Additional Pension Benefit in line with existing laws. While gratuity was a feature of the DBS, he noted that the APB under the CPS is structured in a similar spirit but differs in computation. According to him, the benefit will be calculated using defined service-year brackets and applicable scale rates, which are generally more favourable to most retiring workers.
|
|
|
|---|
Mr Okubadejo described the APB as the first of its kind in Nigeria, specifically designed to make the CPS more attractive and to ease fears surrounding retirement security. He said the initiative reflects Government’s proactive approach to pension administration and confidence-building among public servants.
He further explained that the APB would run for ten years as a compensatory measure for retirees whose accrued pension obligations were not promptly remitted by previous administrations, depriving them of potential investment returns. The benefit, he said, is intended to cushion the effects of those lapses and provide equitable financial relief.
On sustainability, the commissioner noted that large lump-sum withdrawals often reduce monthly pension income. As a result, the government plans to seek approval from the National Pension Commission to preserve pension contributions primarily for monthly payments, while the APB would serve as a one-off retirement benefit, effective from July 2025.
Stay Ahead with Premium Times
Follow us on Google News and never miss breaking stories, investigations, and in-depth reporting.
Add as a preferred source on Google
He urged relevant ministries, PFAs and labour unions to strengthen service delivery, intensify public sensitisation and organise regular pre-retirement training programmes at least six months before workers leave service.
Earlier, permanent secretaries from the Bureau of State and Local Government Pensions, Mrs Arinola Adetayo and Olufisan Osiyale, said the engagements were aimed at improving collaboration, resolving emerging challenges and ensuring smooth access to retirement benefits. They described the CPS as a partnership among the employer, employee and PFAs, stressing that strong synergy remains essential for the success of the scheme.
Responding on behalf of labour unions, leaders of the Nigeria Labour Congress and the Trade Union Congress of Nigeria — Mr Ademola Benco and Mr Akeem Lasisi — commended the governor for what they described as a bold and worker-friendly reform. They noted that concerns over the adequacy of monthly pensions under the CPS had persisted for years but expressed satisfaction that the APB effectively addresses those challenges.
Describing the initiative as innovative and unprecedented, the labour leaders pledged full support for the new retirement benefit structure, saying it reflects the administration’s strong commitment to workers’ welfare, dignity and long-term financial security in Ogun State.
Discover more from Premium Times Nigeria
Subscribe to get the latest posts sent to your email.
More News
