- Joe Ajaero, president of the Nigerian Labour Congress (NLC), advocated for a return to the previous pension scheme, criticizing the current system for failing to provide financial security for workers in their old age
- Ajaero emphasized that the pension scheme should ensure retirees can enjoy their golden years without financial stress and in good health, highlighting the severe looting of non-contributory pension funds and the lack of accountability from those managing them
Joe Ajaero, president of the Nigerian Labour Congress (NLC), has advocated for a return to the previous pension scheme, expressing dissatisfaction with the current system. Ajaero made these remarks at the 2024 National Pre-retirement Summit in Abuja, emphasizing the theme “Challenges, Strategies, Prospects and Opportunities at Retirement in Nigeria.” The event was organized by XEM, a global opportunity and capacity development hub in Africa.
Ajaero criticized the current pension scheme for failing to fulfil its primary purpose of providing for workers in their old age. He highlighted that retirement should be a period workers look forward to rather than dread. According to Ajaero, the federal government allegedly owes nearly N260 billion in pension arrears, with federal parastatals accounting for an additional N40 billion.
He explained that many workers fear retirement because it does not offer the necessary financial security. “The pension scheme, as it currently stands in Nigeria, unfortunately falls short of its fundamental purpose; to provide for workers in their old age. The medium for storing Pensions, the Naira, has maintained an unstable value and depreciated over the years. It is only a stable platform that can truly serve as a solid store of value that can sufficiently maintain the value of contributions when workers retire,” he stated.
Ajaero emphasized that pensions should ensure retirees can enjoy their golden years without financial stress and be healthy. However, he noted that many retirees face health challenges and financial difficulties, leading to untimely deaths. “Retirement under the present scheme may, therefore, become a death sentence for many, and this has many consequences for the behaviour of workers in active service,” he added.
He also mentioned that some states have pension arrears stretching up to eight years, and many private sector companies are in arrears of up to three years, deducting contributions from workers’ salaries without remitting them to the Pension Fund Administrators (PFAs). Furthermore, the Micro-Pensions designed for the informal sector remain inadequately activated, complicating the financial security of informal economy workers.
Ajaero criticized the severe looting of non-contributory pension funds and the lack of accountability from those managing them. He called for statutory agencies responsible for protecting workers’ interests to be more diligent in their duties.
In response, Dr. Folashade Yemi-Esan, Head of Civil Service of the Federation, stated that the service is working hard to improve workers’ welfare. She highlighted a strategic plan spanning 2021-2025 aimed at staff welfare and mentioned a retirement plan in collaboration with the Institute of Public Service of Nigeria and the Bank of Agriculture. This collaboration is intended to encourage workers to get involved in the agricultural value chain through training and soft loans.
George Akume, Secretary to the Government of the Federation (SGF), represented by Dr. Maurice Mbaeri, Permanent Secretary, General Services, Office of the SGF, asserted that the government has been working diligently to improve the lives of citizens, particularly retirees. He emphasized that the public service provides several opportunities to empower public servants and prepare them for retirement.
Dr. Eugenia Ndukwe, Convener of the summit, explained that the event addressed the pressing need for a supportive ecosystem that enables retiring Nigerians to transition smoothly, pursue their passions, and maintain financial stability.
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