On May 16, 2024, the Federal Government refuted claims that it had plans to use the ₦20tn Pension fund for Infrastructure projects. In a statement released in Abuja, Wale Edun, the Minister in charge of Finance and the Economy, assured that the government is committed to abiding by all the set guidelines and regulations concerning the pension fund. After a two-day meeting at the Presidential Villa, the minister informed reporters that the government will be revealing a strategy to utilize domestic funds, including the aforementioned fund, for the purpose of financing infrastructure projects.
In Abuja, on May 16, 2024, Edun emphasized that the pension industry is governed by precise legal regulations, just like other parts of the financial sector. He reassured that the Federal Government had no intentions of surpassing the limits set by law, highlighting their dedication to safeguarding the pensions of workers. He addressed the rumours circulating about the government allegedly planning to unlawfully access workers’ savings and pension funds and assured them that these claims are completely false and unfounded.
There are no plans to heighten the vulnerability of the funds.
Regulations tightly govern the pension sector, along with other financial industries. These regulations outline strict guidelines on permissible Investment options for pension funds. The Federal Government is committed to respecting the boundaries in place to protect the pensions of workers and has no plans to exceed or bypass those restrictions. Edun explained that during the Federal Executive Council meeting, it was revealed that there is a collaborative effort involving all key players in the long-term savings sector.
This initiative aims to explore how funds, available for an extended period, can be utilized to spur investment in crucial areas while adhering to regulations and laws. Additionally, Edun made it clear that the government had no plans to heighten the vulnerability of pension funds or compromise their investment security. In a unified statement, NLC President Joe Ajaero and TUC Deputy President Tommy Okon cautioned the government against jeopardizing the well-being of workers by taking out loans to finance infrastructure projects.
Borrowing from the funds goes against the Pension Act.
Their declaration emphasized the importance of safeguarding Nigerian workers’ savings intended for Retirement security, rather than diverting them towards government projects. They urged a stop to any future attempts to access these funds, highlighting the historical issues of transparency and accountability in government borrowing. The unions requested the government to guarantee that workers’ retirement funds would not be affected by additional borrowing from the Federal Government, particularly in the absence of the envisioned PENCOM Board. They contended that borrowing from the funds goes against the Pension Act. Unions argue that the funds are sacred and should be protected with utmost care to avoid any lack of transparency that may erode their integrity.
Bunmi Ogunkolade, the Head of Information at the Nigerian Union of Pensioners, also emphasized the importance of the government seeking alternate funding for its infrastructure projects. She pointed out that the pension fund should be viewed as belonging to workers rather than just pensioners. The Nigeria Union of Pension in Kaduna State also cautioned the Federal Government against diverting the funds for infrastructure projects. In an interview Mallam Alhassan Balarabe Musa, the state Secretary of the Nigeria Union of Pensioners, mentioned that the Federal Government, led by former President Muhammadu Buhari, made an unsuccessful attempt at a similar initiative.
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They are displeased with the situation. The national headquarters is currently working hard to block access to the fund. It is unfortunate and unacceptable that a significant number of retirees receiving contributory pensions are unable to access their gratuities. The substantial amount being withheld by the Federal Government raises questions about the fairness of the situation. The Pensioners of NUP in Ogun State Council also issued a cautionary notice. Dr. Bola Lawal, the union’s Secretary, expressed doubts about the government’s decision, stating that no pensioner would approve of it. He questioned the reliability of the government’s promise to repay the money in a timely manner.