FG Denies Plans to Access Pension Contributions
By Patience Ikpeme
In response to recent reports suggesting that the Federal Government planned to access citizens’ pension contributions for infrastructure development, the Minister of Finance and Coordinating Minister for the Economy, Mr. Wale Edun, issued a statement denying these claims and assuring Nigerians of the safety of their hard-earned savings and pension funds.
Emphasizing the stringent regulations governing the pension industry, Minister Edun stated that the rules and limitations in place to guide the investment of pension fund assets are aimed at protecting the pensions of workers.
He clarified that a recent announcement made at the Federal Executive Council (FEC) meeting was merely informational and not seeking approval for any action.
The purpose of the announcement he said was to initiate a collaborative effort involving major stakeholders in the long-term savings industry to explore innovative ways, within legal regulations, to maximize the impact of long-term savings on the Nigerian economy.
The Minister outlined potential benefits of this initiative, focusing on driving investment in key growth areas such as infrastructure and housing while facilitating affordable mortgages for Nigerians.
While acknowledging the government’s capacity to provide guarantees to unlock funding for economic growth initiatives, Minister Edun reiterated that there were no attempts to offer unsafe investments for pension funds. The goal is to boost economic growth without compromising the security of pension funds.
Under the Nigerian Pension Act, the federal government is not authorized to directly access pension funds for infrastructure projects. The funds are managed by Pension Fund Administrators (PFAs) and held in trust for contributors, intended to be invested to generate returns and provide retirement benefits.
However, the Pension Reform Act of 2014 allows for the indirect investment of pension funds in infrastructure projects through approved instruments such as infrastructure bonds and funds, ensuring prudent management while supporting critical infrastructure development in Nigeria.
