FG Plans N758bn Bond to Offset Pension Liabilities – PenCom
The Federal Government may issue a N758bn bond before the first week of October to clear outstanding pension liabilities, the National Pension Commission (PenCom) has disclosed.
Speaking at a press briefing in Abuja on Thursday, the Director of Contribution and Bond Redemption Department at PenCom, Usman Musa, explained that the process had already begun and was moving quickly following the approvals of the Federal Executive Council and the National Assembly.
“As the DG has mentioned, the process of issuance of the N758bn bond has commenced. In fact, we have gone very fast,” Musa said. “We are hopeful that by the end of this month, or at least the first week of October, we will start receiving the process. And once that is done, the bond is ready to go; we will commence payment.”
In her address, the Director-General of PenCom, Omolola Oloworaran, said the inauguration of the Pension Industry Leadership Council marked a “historic milestone” for the pensions industry.
She explained that the council was designed to provide collective leadership and coordination, similar to the Bankers’ Committee in the financial system.
According to her, “Since 2004, the Contributory Pension Scheme has mobilised long-term savings, restored retirement dignity and bolstered financial stability. But that said, there are still urgent challenges. This includes coverage gaps, adequacy, governance and impact. We must demonstrate impact, and we need to do a whole lot more of that.”
She stressed that the mandate of the new council was clear, listing its tasks as expanding coverage, especially to the informal sector, enforcing governance and fiduciary standards, channelling assets into national development while safeguarding contributors’ interests, driving innovation in products and processes, and strengthening public confidence.
Oloworaran described the reforms being driven by President Bola Tinubu as “pension revolution 2.0,” pointing to directives on health care provision and a minimum pension guarantee for retirees.
She said, “The President is passionate and also a dear fighter for ordinary Nigerians. His charge is very clear: there must be social protection for ordinary Nigerians in old age .”
Regarding concerns about inflation and the value of Retirement Savings Accounts, she noted that PenCom was working on revised investment regulations to increase exposure to alternative and real assets, thereby hedging against devaluation and inflation.
“What we are doing as regulators is passing laws and regulations that allow PFAs to optimise returns,” she explained.
She also confirmed that under the Contributory Pension Scheme, retirees were receiving their benefits promptly and noted that all arrears have been cleared.
“You get your benefits now, the month that you retire, provided that you follow the right process,” she said, adding that payments were up to date as of September.
The DG admitted that efforts to capture the informal sector through the micro-pension plan had underperformed but promised that new initiatives would soon be unveiled.
“Like I said, the language is reform, reform, reform. From Monday next week, begin to see the reforms unfold,” she told journalists.
Earlier in February 2025, it was reported that the Federal Government said it would issue bonds worth N758bn to clear accumulated pension debts.
This includes debts owed under the old Defined Benefit Scheme before the introduction of the Contributory Pension Scheme in 2004, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, told journalists in Abuja.
He said after considering plans to address outstanding pension liabilities, the FG, through the Debt Management Office, will issue bonds of about N758bn to clear accumulated pension debts owed under the old Defined Benefit Scheme.
These liabilities, he explained, accumulated over the years due to periodic wage increases, and clearing them will grant long-overdue relief to affected pensioners.