The new pensions law

In recent years, there have been reported cases of mismanagement and brazen looting of pension funds by those entrusted with its management. While many of the pension thieves escape with undue leniency, millions of pensioners go through harrowing experiences largely because the problems with the administration of their pensions have not been decisively addressed. It is in this regard that we welcome the new pensions law recently passed by the Senate.

The new law, at least on paper, could well be the solution to Nigerian   pensioners’ problems, if properly enforced. It sets out a clear message that looters or intending ones can no longer engage in such criminal conduct without dire consequences. Key, among the sanctions in the legislation entitled “An Act to Repeal the Pensions Reform Act 2004 and Enact the Pensions Act 2013, is a 10-year jail term for pension thieves.


Besides, the new pensions law seeks to establish a uniform set of rules, regulations and standards for the administration and payment of retirement benefits.

Also, the law makes provision for contributory pensions scheme as well as provisions that will ensure that every person who works in either the public service of the federation, including the Federal Capital Territory (FCT), states and local councils, or the private sector, receives his/her retirement benefits as due.

In respect of the private sector, the scheme “shall apply to employees who are in the employment of an organisation in which there are 15 or more employees”.

In addition, the new law stipulates that whoever attempts to misappropriate the fund will, on conviction by the court, be liable to the same punishment as is prescribed for the full offence in the Act. Ten million naira is the fine for any pensions fund administrator which fails to meet its obligations to contributors, while each of the directors of the firm will pay a fine of N5 million.

Beyond all of the above, the new law says that anyone who embezzles pension fund shall forfeit the loot, whether in property or money, with accrued interest.

The passage of the bill into law followed its thorough consideration by the Senate Committee on Establishment and Public Service.

All things considered, the new law may allay the anxiety and anger that often trail the looting of pension funds, in particular, the bewildering case of a former assistant director in the civil service, Mr. John Yusuf, who, in connivance with others, looted N27.2 billion of the Police Pension Fund, but received a laughable two year-imprisonment or an option of N750, 000 fine by a High Court in Abuja, presided over by Justice Mohammed Talba.

Now that the Senate has passed this law, we urge the House of Representatives to quickly do so too, so that it can be harmonized and sent to the president for his assent.

The president should also sign the Act into law as quickly as possible, so that there would no longer be an escape route for offenders. In the same vein, state legislatures should domesticate the pension law. This is especially with regard to the provision relating to contributory pension and the upward review of the rate payable by employers and employees.

We welcome the provision in the new law that recommends minimum 15 years post-qualification experience for a Director-General of the Pensions Commission (PENCOM). But, the person should be somebody of proven integrity. Hitherto, 10-year post-qualification experience was enough for a holder of that office.

Altogether, strict enforcement of the new law is of utmost importance to serve as a deterrent to pension fraudsters.

 The problems in pensions administration cannot be solved by merely having the law. Its provisions must be applied to the letter. Sanity must be seen to prevail in the pensions scheme at all tiers of government and in both the public and private sectors. Pensions are funds that people have worked for. Retired workers deserve their pensions and should not be deprived of it.