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•Imperative of good pension plan
By Henry Uche [email protected]
Millions of Nigerians go to work every day haunted by a single fear: survival after service! The accompanying billion naira question they do not ask aloud is; what happens when the paycheque stops?
This fear has shaped work ethos. It does not make daily headlines, yet it steadily corrodes productivity, ethics and trust in public institutions.
In Nigeria, retirement is not merely the end of active service; for many, it represents uncertainty, humiliation and economic vulnerability. This fear, widely internalised but rarely confronted, has become a silent syndrome shaping behaviour in the workplace and distorting economic choices in ways far more damaging than many election-season promises or policy pronouncements.
For those in ‘juicy’ establishments and have access to the purse, the question then become; how much do I steal to hedge for the rainy day?
Under Nigeria’s civil service rules, retirement is compulsory at 60 years of age or after 35 years of service. In theory, this marks a transition to a dignified phase of life supported by pension benefits. In practice, it has become a psychological burden that workers carry from their earliest years in service. The consequences, experts say, ripple far beyond individual distress, breeding sharp practices, weakening institutions and quietly draining the economy.
Industrial psychologists argue that the long history of pensioner suffering in Nigeria has embedded a survival instinct within the workforce, one that fuels dishonesty, theft, time-wasting and misuse of public resources.
According to them, the fear of the unknown after retirement encourages workers to “prepare for the worst” while still in service. That preparation, in many cases, takes the form of unethical behaviour justified as saving for a bleak future.
One case that illustrates this dynamic is that of Charles Otiti, a 35-year-old storekeeper in a federal government agency. Employed at Level 05 at age 25, Otiti had not received a single promotion by the time he turned 32. Yet, he lived with unusual confidence and brazen disregard for hierarchy, often boasting that he was financially ready to retire “any day.”
Colleagues soon learned why. Otiti was part of a money-sharing syndicate within his agency, working under the protection of a Level 15 officer who headed a sensitive disbursement committee. The committee was tasked with overseeing the release of long-overdue allowances and equipment funds owed to medical doctors nationwide, funds running into billions of naira. The money was legitimate. The diversion was not.
Before completing the assignment, the committee chairman ensured that each member walked away with millions in personal gains. Otiti’s loyalty to his superior earned him a share, despite his junior rank. The sudden wealth transformed him from an obscure storekeeper into an insolent civil servant with visible assets.
Not long after, news spread that Otiti had opened a petrol station along the Lagos–Badagry expressway, near a prominent church.
According to colleagues, his wealth came from procurement scams, inflated budgets, manipulated figures and abuse of his control over logistics and supplies.
Stories like Otiti’s are not isolated. Across ministries, departments and agencies, and even within the private sector, workers manipulate systems under the justification of “saving for rainy days.” For many, the rain is retirement.
Crisis rooted in history
Nigeria’s pension nightmare did not begin today. Its roots stretch back to the 1950s, when pension administration followed a British-defined structure ill-suited to local realities. Over decades, weak oversight, poor planning and inconsistent policy implementation turned pensions into a recurring national embarrassment.
The flaws in the old system led to the enactment of the Pension Reform Act (PRA) 2004. But that reform came with its own shortcomings. Many state and local government workers were excluded, several governors failed to adopt the scheme, and implementation gaps widened distrust.
To address these weaknesses, the National Assembly passed an amended Pension Reform Act in 2014, signed into law by former President Goodluck Jonathan on July 1, 2014. The objective was clear: fix loopholes, restore transparency and protect senior citizens who had given their productive years to the state.
In theory, the Contributory Pension Scheme (CPS) introduced accountability and sustainability. In practice, poor funding, political interference and weak enforcement continued to undermine its promise.
Nigeria’s pension administration remains characterised by what industry watchers describe as “administrative negligence, weak social security structures, poor sustainability planning and systemic indifference.”
At the local government level, retirees are often treated as expendable. Westernisation and economic hardship have eroded traditional support systems for the elderly, leaving pensioners exposed. Even the 2014 Act, critics say, contains ambiguities and inconsistencies that worsen the plight of retirees.
Implementation remains the Achilles’ heel. Political appointees have repeatedly interfered with pension funds. Many states fail to remit counterpart contributions. Inflated and inaccurate records complicate disbursement. One infamous example was the discovery of over 23,000 ghost pensioners during a military verification exercise in the early 2000s under the Defined Benefits Scheme.
Tardiness in pension payments has been equally devastating. Pensioners were once forced to endure multi-day verification exercises under harsh weather conditions. Some collapsed in queues; others died waiting. Though reforms have reduced such scenes, scars remain.
Where institutions collide, pensioners suffer
Conflicts between federal and state governments further complicate pension administration. Workers who served both tiers often fall between bureaucratic cracks. Some governors remain reluctant to fully key into the CPS, leaving retirees stranded.
Yet, under the current leadership of the National Pension Commission (PenCom), there are signs of renewed urgency. The Director-General, Omolola Bridget Oloworaran, has repeatedly stated her commitment to restoring dignity to retirement.
In less than two years, PenCom has introduced a zero-tolerance stance on pension defaults, rolled out a Zero Waiting Time policy, launched Pension Boost 1.0, reviewed monthly pension payments upward and accelerated automation of pension processes.
She also inaugurated the Pension Industry Leadership Council to foster collaboration, promote innovation, expand coverage and strengthen confidence in the system. A direct communication channel now allows retirees to report unethical practices by Pension Fund Administrators (PFAs), turning beneficiaries into watchdogs.
In late 2025, PenCom launched Pension Revolution 2.0, described by experts as the most comprehensive reform since 2014. It aims to enhance retiree welfare, expand pension access and mobilise long-term capital for national development. The PenCare Initiative, with its newly inaugurated Board of Trustees, targets affordable healthcare for retirees.
PenCom has also partnered with agencies such as the Corporate Affairs Commission and the Federal Inland Revenue Service, while launching a satisfaction survey to capture feedback from retirees and Retirement Savings Account holders.
Still, reform at the top does not automatically translate to relief on the ground.
Who bears the blame?
Responsibility for pension distress is widely shared. Governments at all levels set the framework for pension administration, yet control mechanisms, monitoring systems and performance management tools remain weak.
The integrity of individuals entrusted with pension administration has been repeatedly questioned. A particularly painful chapter was the case of Abdulrasheed Maina, former chairman of the Presidential Task Force on Pension, accused of diverting N2 billion in a biometric scam in 2015.
Financial institutions, PFAs, Pension Fund Custodians, the Offices of the Accountant-General and Auditor-General, and relevant ministries have also been criticised for bureaucratic bottlenecks that exhaust retirees before they receive their entitlements.
Employers, too, play a major role. More than 60 per cent of employers in both public and private sectors are accused of failing to remit contributions adequately and on time. Labour unions, critics argue, focus more on current wages than post-retirement security, creating a dangerous gap between active service and retirement.
Human cost of fear
For many workers, retirement anxiety has become a psychological weight. Fredrick Nwabueze, a middle-level manager, describes it as “Nigeria’s quiet economic time bomb.”
“The fear of life after work is what breeds 90 per cent of corrupt practices in all sectors,” he said. “We are all afraid of tomorrow. Inflation will chop off your pension. You can’t buy anything new in this country. It’s sad.”
A retired female civil servant who requested anonymity was even more blunt. She said she regretted not engaging in corrupt practices while in service.
“I suffered to collect my 25 per cent lump sum. Inflation has destroyed everything,” she said. “Some of my colleagues who stole are living well. Nobody is after them. After 35 years of service, you cannot boast of a comfortable life. The fear of retirement is more devastating than the fear of death.”
Her words echo a sentiment heard in many offices: integrity often feels unrewarded, while opportunism appears profitable.
Politics and Pension Peril
With elections approaching, analysts fear that pension funds may again become political tools. Historically, some governors have withheld salaries and pensions for months, only to release them close to election periods.
Observers warn that retired military personnel protesting unpaid benefits pose not just a moral failure but a national security risk. Nigeria has also witnessed repeated protests by the Nigeria Union of Pensioners, a troubling symbol of systemic neglect.
A path forward
Experts insist solutions are not far-fetched. Barrister Olowu Abiodun, a lecturer and retired assistant director, believes leadership is central.
“There will never be transparency and accountability in pension administration if people with dubious hearts are in charge,” he said. “If the right people are given the right jobs, the right things will be done.”
Human rights advocates call for full implementation of provisions such as the Guaranteed Minimum Pension and the Pension Protection Fund. Others advocate continuous pension education for workers from entry to retirement.
Gerontological caregivers urge stronger enforcement powers for PenCom and seamless implementation of the National Single Window Policy to reduce pre- and post-retirement stress.
International observers have praised the release of N758 billion in pension bonds to clear arrears but warn that more must be done to cushion economic hardship.
According to experts, Nigeria cannot continue to ignore retirement anxiety. A workforce that fears the future cannot build a stable economy. As one policy analyst warned, “If Nigerian workers are not assured of a dignified life after retirement, then the country is doomed.”
Retirement should be a reward, not a punishment. Until that changes, fear will continue to shape behaviour and the economy will keep paying the price.
