PenCom disburses N577bn to 1.05 million RSAs as pension arrears ease

“In a whole, the total payout of N577,264,960,890 has already hit the RSAs of either retirees or pension contributors.”

The National Pension Commission (PenCom) on Tuesday said it has disbursed N577.26 billion to 1,053,000 Retirement Savings Accounts (RSAs), easing long-standing pension arrears under the Contributory Pension Scheme (CPS).

The Head of PenCom’s Management Services Department, Usman Musa disclosed this at the 2025 PenCom Media Conference in Abuja.

The payments were made from the N758 billion Federal Government bond approved earlier this year to settle outstanding pension liabilities. PenCom said the funds had reached the RSAs of retirees and active contributors.

“In a whole, the total payout of N577,264,960,890 has already hit the RSAs of either retirees or pension contributors. In total, this has directly impacted 1,053,000 Retirement Savings Accounts,” Mr Musa said.

He said the full N758 billion bond approved by the federal government had been released to the commission.

According to him, N387 billion of the bond was earmarked for pension increases, out of which N362.7 billion has been paid. He said the balance was still being processed.

Mr Musa also said PenCom remitted N107 billion to cover a 2.5 per cent pension contribution shortfall by the federal government between 2017 and 2021, when contributions were not fully remitted. The funds, he said, were paid directly into the RSAs of 750,232 contributors.

A significant share of the payouts went to security sector retirees. “Out of the 354 billion we’ve paid out, 32% of it, N132 billion, was paid out to the police,” he said.

Earlier, PenCom Director-General, Omolola Oloworaran, said the approval and disbursement of the N758 billion bond marked one of the most significant interventions in Nigeria’s pension administration.

She said the bond sent a clear signal that the government was committed to clearing pension backlogs and strengthening confidence in the CPS.

As part of efforts to improve benefit adequacy, Ms Oloworaran said PenCom introduced Pension Post 1.0, which has added N2.68 billion to monthly pension payments for CPS retirees since June.

“These are not just numbers. They are meals on tables, medicine bought, debts settled, and dignity preserved,” she said.

PenCom also tightened compliance across the pension value chain in 2025 by linking Pension Clearance Certificates to participation in pension-related financial transactions.

The commission said companies without valid certificates are barred from doing business with Pension Fund Administrators, custodians and major banks.

The move, PenCom said, led to a sharp rise in recoveries. Pension recoveries between January and November 2025 rose to N4.04 billion, compared with N1.44 billion recorded in the whole of 2024. Of that amount, N2.06 billion was recovered in the third quarter alone.

“This clearly demonstrates that when compliance is tied to real economic consequences, behaviour changes,” Ms Oloworaran said.

Nigeria introduced the Contributory Pension Scheme in 2004 to replace the old defined-benefit system, which was characterised by funding gaps, weak oversight and delayed payments.

While the CPS improved transparency, pension arrears, particularly unpaid accrued rights and pension increases, persisted for years due to funding shortfalls.

In February 2025, the Federal Executive Council approved the issuance of a N758 billion bond to fully settle outstanding pension liabilities, including accrued pension rights, pension increases since 2007, the Pension Protection Fund and the university professors’ pension shortfall.