Ogun okays additional pension benefit for retirees
Ogun State Government has reaffirmed its commitment to improving the welfare of workers and retirees under the Contributory Pension Scheme (CPS), with the approval of an Additional Pension Benefit (APB)
Ogun State Government has reaffirmed its commitment to improving the welfare of workers and retirees under the Contributory Pension Scheme (CPS), with the approval of an Additional Pension Benefit (APB) aimed at enhancing retirement security and closing existing gaps in the scheme.
The development was disclosed during a meeting chaired by the Commissioner for Finance and Chief Economic Adviser, Mr. Dapo Okubadejo, following strategic engagements between the state government, labour unions, Pension Fund Administrators (PFAs) and members of the Pension Fund Management Committees.
He said compliance with the CPS law was mandatory and beneficial to employees and the state.
He noted that the Defined Benefit Scheme (DBS) and the CPS were fundamentally different, stressing that the administration of Governor Dapo Abiodun remained committed to addressing identified gaps, in order to safeguard workers’ interests.
He said the governor had approved the introduction of Additional Pension Benefit in line with existing laws.
While gratuity was a feature of the DBS, he noted that the APB under the CPS was structured in a similar spirit, but differed in computation. According to him, the benefit will be calculated using defined service-year brackets and applicable scale rates, which are generally more favourable to most retiring workers.
Okubadejo described APB as the first of its kind in Nigeria, designed to make the CPS more attractive and to ease fears surrounding retirement security. He said the initiative reflected government’s proactive approach to pension administration and confidence-building among public servants.
He said APB would run for 10 years as a compensatory measure for retirees whose accrued pension obligations were not promptly remitted by previous administrations, depriving them of potential investment returns.
The benefit, he said, was intended to cushion the effects of the lapses and provide equitable financial relief.
On sustainability, the commissioner noted that large lump-sum withdrawals often reduced monthly pension income.
‘’As a result, the government plans to seek approval from the National Pension Commission to preserve pension contributions primarily for monthly payments, while APB will serve as a one-off retirement benefit, effective from July 2025.’’
He urged relevant Ministries, PFAs and labour unions to strengthen service delivery, intensify public sensitisation and organise regular pre-retirement trainings at least six months before workers leave service.
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Permanent secretaries from the Bureau of State and Local Government Pensions, Mrs. Arinola Adetayo and Olufisan Osiyale, an engineer, said the engagements were aimed at improving collaboration, resolving emerging challenges and ensuring smooth access to retirement benefits.
They described the CPS as a partnership among the employer, employee and PFAs, stressing that strong synergy remained essential for the success of the scheme.
Responding on behalf of labour unions, leaders of Nigeria Labour Congress and Trade Union Congress of Nigeria — Mr. Ademola Benco and Mr. Akeem Lasisi — hailed the governor for what they described as a bold and worker-friendly reform.
They noted that concerns over the adequacy of monthly pensions under the CPS had persisted for years, but expressed satisfaction that the APB effectively addressed those challenges.
Describing the initiative as innovative and unprecedented, the labour leaders pledged full support for the new retirement benefit structure, saying it reflected the administration’s strong commitment to workers’ welfare, dignity and long-term financial security in Ogun State.