The National Pension Commission (PenCom), at the weekend, said Nigeria’s 2004 pension reform has continued to deepen under successive administrations, just as it remains one of the most significant and enduring transformations in the country’s financial sector.
The Head of the Corporate Communications Department, PenCom, Ibrahim Buwai, stated this at the 36th Annual Conference of the Finance Correspondents Association of Nigeria (FICAN), with the theme, “Building on the Gains of Recapitalisation, Tax Reforms and the Fintech Revolution,” which held at the weekend in Lagos.
Buwai said the pension reform, which commenced in 2004, remains one of the country’s most sustained financial-sector reforms, despite challenges encountered over the years, particularly delays in the payment of pension obligations in the public sector.
According to him, “since 2004, when Nigeria embarked on pension reform, to the present administration, the reform has been sustained and deepened. The reform is one of the enduring reforms in the financial sector.
“However, we have also encountered challenges relating to delayed payments in the public sector.”
According to him, the pension sector has recorded a significant turnaround, moving from a position of deficit to surplus, while the Federal Government has made substantial progress in settling the accrued pension rights of retiring public servants.
Buwai disclosed that the Federal Government was currently 41 months ahead in the payment of accrued pension rights, indicating that pension liabilities due to federal government employees retiring up to December 2029 had been provided for.
“Today, we are 41 months in surplus. This means that we have paid the accrued pension rights of federal government employees due to retire up to December 2029,” he said.
He identified the recent payment of additional benefits to retired federal civil servants as another significant development in the implementation of the pension reform.
Buwai explained that the Contributory Pension Scheme (CPS) did not abolish gratuity or prevent employers from granting additional retirement benefits to their workers, citing Section 4 of the Pension Reform Act. The Act provides for additional benefits where employers are able and willing to provide such benefits in accordance with the law.
According to him, the Federal Government recently paid about N1.1 billion in additional exit benefits to 175 retired civil servants who worked in Treasury-funded ministries, departments and agencies (MDAs) and retired between January 1 and August 31, 2026.
“The pension scheme has not taken away gratuity. Section 4 of the Pension Reform Act makes ample provision for additional benefits, as long as the employers are able to provide them,” Buwai said.
He urged private-sector employers to emulate the Federal Government by considering additional retirement benefits for their employees, particularly in recognition of years of service and contribution to organisational growth.
Buwai said such measures would complement the formal pension system and further strengthen retirement security for Nigerian workers.
He also stressed the importance of sustained reforms and responsible management of pension funds, noting that the gains recorded in the sector needed to be consolidated through effective regulation, timely remittances and improved compliance by employers.
The PenCom official’s comments came against the backdrop of broader reforms in Nigeria’s financial sector, including banking recapitalisation, tax reforms and the rapid expansion of financial technology, all of which were central to discussions at the FICAN conference.
The pension reform, introduced in 2004 to replace the largely unfunded and unsustainable defined-benefit pension arrangements with a contributory system, has since evolved into a major component of Nigeria’s financial architecture.
Buwai’s remarks underscored the need for stakeholders to sustain the reform momentum while addressing outstanding challenges, particularly the timely fulfilment of pension obligations and the need to provide retirees with adequate financial security after years of service.
