Budgetary deficiencies and delayed release of funds are exacerbating the challenges faced by pensioners

Edited by Afolabi Hannah

It appears that the reduction in the budget allocation for pensions, gratuities, and benefits for retirees in the 2024 budget is causing further delays in the disbursement of retirement benefits to Federal Government retirees and deceased employees.

Investigations indicate that the hope of clearing outstanding entitlements for 2023 in the first quarter of 2024 and addressing payments for the current year has been dampened by the reduced budget allocation. The last disbursement for retirees’ accrued pension rights by the Federal Government was in March 2022.

A review of the 2024 Appropriation Act reveals that the allocation for pensions, gratuities, and retirees’ benefits was slashed by 21% to N673.01 billion from N854.81 billion in 2023. This reduction is causing distress among retirees awaiting their entitlements.

Despite retirees voicing concerns over the delay in receiving their benefits, the National Pension Commission (PenCom) attributes the setback to budgetary limitations. PenCom’s Director General, Mrs. Aisha Dahir-Umar, explained that insufficient and delayed funding for Accrued Pension Rights dating back to pre-Contributory Pension Scheme era is hindering timely payments. She emphasized that PenCom lacks the authority to release funds and is reliant on the government for budget allocations.

The situation has left numerous pensioners in dire straits, as Accrued Pension Rights encompass benefits accumulated up to June 2004 before the inception of the Contributory Pension Scheme.

Various stakeholders in the pension sector have expressed dismay over the delays. The President of CPUN’s Ibadan branch, Mr. Amao Shittu, criticized the government’s tardiness in disbursing pension benefits and demanded prompt settlements without pro-rating into extended periods. NUPCPS Chairman, Mr. Sylva Nwaiwu, highlighted the importance of implementing the CPS effectively to safeguard pensioners’ interests.

Furthermore, ARFESPON’s Chairman stressed the urgency of settling outstanding pension arrears and rectifying any unauthorized deductions from retirees’ pensions.