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FG Approves N34 billion As Pension Benefits

By on August 10, 2012

The Federal Government has approved the sum of N34 billion as pension arrears and death benefits for retirees of the federal civil service.

National Pension Commission spokesperson, Mr. Emeka Onuora made this known in a statement released on Thursday.

It stated, “PenCom would like to inform retired employees enrolled with the commission, including the next of kin of deceased employees that have documented with the Pension Fund Administrators and documents submitted to the commission but have not been paid their entitlements that the President of Nigeria, Dr. Goodluck Jonathan, has approved the release of N34bn to offset the outstanding accrued rights of retirees and death benefits of deceased employees of Federal Government under the Contributory Pension Scheme.”

The statement explained the government had consistently set aside 5% of its total monthly wage bill into the Retirement Bond Redemption Account with the Central Bank of Nigeria for the settlement of the accrued pension rights of its employees since the commencement of the Contributory Pension Scheme as required by the Pension Reform Act, 2004.

Onuora explained that the account had become overstretched in recent years due to the upsurge of retirements from the Federal Civil Service due to the tenure policy, voluntary retirements and unredeemed death benefit claims.

This in turn resulted in a backlog of arrears that could not be accommodated as a result of paucity of funds in the account.

“This special positive intervention by Mr. President, therefore, would go a long way in settling those outstanding payments to those categories of beneficiaries and alleviating their sufferings,” PenCom stated.

The statement added, “Our appreciation also goes to the coordinating minister for the economy and minister of finance for her continued support to pension reform and commitment in addressing the plight of the retirees.”

PenCom recommended that the government payfive yearly rates of 13 per cent, 11 per cent, 10.5 per cent, 8.5 per cent and 5.12 per cent of its total wage bill from 2012 to 2035 into the RBBRF account,  as against a fixed rate of five per cent per annum, which was said to be grossly inadequate.

It said that this would adequately cover the accrued benefits of Federal Government retirees up to 2039 when such liabilities were expected to be extinguished.

One Comment

  1. obiakpo

    August 10, 2012 at 3:40 pm

    Just watch and see how the Cabal involved will divert half of the fund or more for their personal and selfish use.God will judge all of you who try to make life difficult for the poor and needy in Nigeria.