President Bola Tinubu has requested the approval of the National Assembly for the issuance of federal government Bonds in the domestic debt market by the Debt Management Office (DMO) to settle outstanding Pension Liabilities under the Contributory Pension Scheme (CPS) as at December 2023 in the sum of N757,983,246,571.
The President made the demand in a letter dated May 22, 2025, which was addressed to the Speaker of the House of Representatives and read at the plenary on Tuesday.
According to him, I write to request for the kind approval of the National Assembly for the issuance of Federal Government of Nigeria (FGN) Bonds in the domestic debt market by the Debt Management Office (DMO) to settle outstanding Pension Liabilities under the Contributory Pension Scheme (CPS) as at December 2023 in the sum of N757,983,246,571.
Tinubu explained that the Pension Reform Act (PRA), 2014 provide for the following, amongst others: Sections 15(1) and 39(2-3), which recognise the accrued pension rights of employees for services rendered before the commencement of the implementation of the PRA, 2004 in Nigeria, mandate the FGN to set aside 5 per cent of its monthly wage bill into Redemption Fund to settle such past pension liabilities and National Pension Commission to determine any shortfall in this regard.
The President noted that Section 15(4) – Guarantees the right of retirees to pension review in line with the provisions of the 1999 Constitution (as amended) which provides that pension shall be reviewed every five years or whenever salaries are reviewed:
He further highlighted Section 6(2) – which requires the government to fund the shortfall in the Retirement Savings Accounts (RSAs) of eligible University Professors who are to retire on their full salary in line with extant laws; and,
The president noted that Section 82(2) – Establishes the Pension Protection Fund and mandates the federal government to contribute annual subvention of one per cent into the Fund to part finance minimum Pension Guarantee for retirees whose RSA balances had depleted while receiving pension.
He stated: “The House of Representatives is invited to note that the FGN has not been complying with the implementation of the above provisions of the PRA 2014 over the years due to revenue challenges leading to accumulation of pension arrears with the attendant hardship to retirees.
“To settle the accrued pension liabilities as of December 2023 in the sum of N757,983,246,571.00, the government has decided to raise funds through the issuance of FGN Bonds in the domestic debt market.
“The proposed Issuance of FGN Bonds to settle outstanding pension liabilities was approved by the Federal Executive Council in its meeting held on February 4, 2025.
“This request to the National Assembly to approve the Issuance of FGN Bonds by the DIMIO to settle pension liabilities in the sum borrowing of N757,983,246,571.00 is pursuant to the provisions of Section 44(1-2) of the Fiscal Responsibility Act (FRA), 2007 which requires the approval of the NASS for all New Borrowings by the FGN.”