FG Releases 25% of Budgeted N88bn for Pension Arrears

About 25% of the total amount budgeted for pension arrears this year has been released by the Federal Government.

However, it has pledged to settle the N88bn earmarked for pension arrears in the 2024 budget.

When hundreds of frustrated retirees from Nigeria’s Contributory Pension Scheme staged a protest at the Federal Ministry of Finance in Abuja, on Tuesday, Wale Edun, the Minister of Finance and Coordinating Minister of the Economy made the commitment.

The main entrance of the ministry was blocked by retirees, demanding an audience with Edun and angered by prolonged delays in the payment of their pension arrears.

Edun disclosed while addressing the crowd that of the N88bn budgeted for pension arrears in 2024, N22bn had already been disbursed.

The retirees were assured that the remaining funds would be paid by the end of the year, with disbursements set to commence next week.

While reaffirming the government’s commitment to resolving the issue, Edun attributed the pension backlog to challenges within the older system.

“What has happened is that there is a backlog in terms of contributions, the backlog under the old system and there is a solution. There has been a committee under the Head of Service, that has met the Minister of Budget, and we have a plan for dealing with the backlog under the Contributory Pension Scheme.

“In addition, under the current budget (2024), there is about N88bn of which N22bn has been paid. And that balance, we are committed to paying it. It has to be paid this year. We are committed to doing that starting next week”, he said.

Edun revealed that the government is considering raising funds through the capital market to clear the backlog entirely for a sustainable long-term solution.

“In terms of the longer term, it is a huge amount, and we have to have a solution that takes care of everybody. That is being worked on. It’s going to be a question of going to the capital market and raising an instrument that allows that backlog to be cleared once and for all.

“In the immediate term, there will be payment for what is under the current budget and we are working, and we are going to present to Mr President a viable solution using the financial market to take care of the huge backlog under the contributory pension scheme.

“Your funding under the budget will be paid. We will start next week and pay for everything that we can under the current budget as approved by the National Assembly,” Edun said.

The minister’s assurances came as retirees across the country continue to express concerns over delayed payments, calling for prompt action to alleviate their financial hardships.