Omolola Oloworaran, director-general (DG) of the National Pension Commission (PenCom), says the agency is planning to increase employers’ statutory pension contribution rate under the ongoing review of the Pension Reform Act (PRA) 2014.
Oloworaran disclosed the proposal on Tuesday at the 2026
pension consultative forum for states, the Federal Capital Territory (FCT), and
licensed pension fund operators (LPFOs) in Lagos.
Under the current framework, employers contribute a minimum
of 10 percent of an employee’s monthly emoluments, while employees contribute 8
percent, putting the total mandatory pension contributions at 18 percent.
Oloworaran said PenCom is in talks with the organised labour
and the national assembly on amendments to the PRA.
The move, according to the DG, is aimed at strengthening
retirement security through higher contribution rates.
She, however, noted that the process has not moved past the
consultation stage.
“We are having active conversations regarding the review of
the Pension Reform Act with all necessary parties, including labour and the
National Assembly,” Oloworaran said.
“It is still at the engagement stage. The rates of
contribution will certainly go up, but we must ensure that all key stakeholders
buy into it first.”
The PenCom DG also raised concern over the slow adoption of
the contributory pension scheme (CPS) by state governments, noting that only
eight of Nigeria’s 36 states are currently compliant.
She rated the commission’s progress on state-level CPS
adoption an “F9”, and called on governors to show greater political will.
“I am not satisfied at all with where we are. If you were to
rate it, we still have an F9. We still have only eight states out of 36 states
complying,” she said.
“There has to be more political will. Governors must
prioritise their workers and their future when they retire, not just worry
about today. All 36 states should be under the Contributory Pension Scheme.”
On funding constraints cited by non-compliant states,
Oloworaran said PenCom is exploring dedicated income streams for state pension
bureaus, though she did not commit to a specific model.
“We have listened to them, and I think there is a good point
in what they are saying. We will explore ways to create income streams for
state pension bureaus,” she said.
“It might not be in the exact form they are prescribing, but
we will certainly do something.”
Oloworaran also faulted the practice by some state
governments of deducting pension contributions from workers’ salaries without
remitting the funds into employees’ retirement savings accounts (RSAs).
She warned that the practice exposes contributors to risk if
diverted by successive administrations.
“In my personal opinion, deducting funds from employees and
putting them in a state account is something that should never happen,” the
director-general said.
“Any incoming governor who doesn’t understand the original
purpose of those funds could divert them elsewhere. That results in pension
obligations skyrocketing and leads to a broken system in the future.”
She said the commission would step up engagement with such
states to end the practice.
The PRA 2014 replaced the 2004 pension law and introduced
the CPS, under which PenCom regulates Nigeria’s pension industry.
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