Editorial

Another Look At Contributory Pension Scheme

Published

1 year ago

August 6, 2024

In a report from the National Pension Commission (PenCom), it was disclosed that only 26 states in Ni-
geria have implemented the Contributory Pension Scheme (CPS), two decades after the Pension Reform Act (PRA) 2004 was passed. The report highlights the inconsistent espousal of the CPS across states, with some states partially adopting the scheme, others not yet participating, and some facing challenges in getting the bill approved in their state legislative assemblies.
In 2012, the Rivers State Government, under the leadership of former Governor Chibuike Rotimi Amaechi, embarked on a critical initiative by enforcing the Contributory Pension Scheme. This strategic move aimed to establish a sustainable pension system by requiring contributions from both the employer and the employee. The arrangement was designed to ensure that employees have a secured and reliable source of income post-retirement, fostering financial security and stability for the workforce.
Following the introduction of the plan, the government adopted a three-year transition that aimed to fully implement the scheme by 2015. During this transition period, the authorities focused on educating both employers and employees about the benefits and responsibilities of the CPS. This included workshops, seminars, and public awareness campaigns to ensure that all stakeholders were well-informed about the scheme.
The creation of the CPS represents an important milestone in the ongoing efforts to overhaul and enhance the state’s pension system, aiming to establish a more robust and secure retirement savings framework for its workforce. The primary objectives of the CPS are to effectively tackle the inherent shortcomings of the former pension system, including limited coverage, insufficient benefits, and financial uncertainty. This strategic framework is designed to ensure that employees receive sustainable and dependable retirement benefits.
However, to ensure fairness and protect the rights of all workers, it is imperative that the effective date of the contributory pension law be prospective, applying only to workers hired on or after 2012. This would allow those employed before 2012 to continue to benefit from the provisions of theDefined Benefit Scheme (DBS), while ensuring that new hirees are subject to the updated pension provisions.
Unfortunately, the pension programme has experienced several challenges. Despite monthly deductions being taken from civil servants’ salaries for their counterpart funding, the government has not fulfilled its obligation to contribute its share. This has impeded the advancement of the scheme and has left many civil servants without sufficient pension arrangements upon retirement.
As a result, the state pension law has undergone multiple revisions to address the issue of retiring civil servants who ordinarily should be covered by the contributory scheme. The amendments have aimed to accommodate these individuals within the DBS which provides a guaranteed level of pension based on years of service and salary grade level.
The inability of the contributory pension scheme to gain traction has sparked worries about the long-term viability of the state pension system. The absence of government contributions has resulted in a funding shortfall that jeopardises the government’s capacity to fulfil its pension commitments to employees in the future.
Even if the CPS was created to address the perceived shortcomings and lack of sufficient funding of the DBS by combining funds from employers and employees’ contributions to pension funds custodians, retirees under the scheme have not experienced better outcomes than those who retired under the DBS. On the contrary, the execution of the CPS is different from what its advocates led employees to expect.
The complaints regarding the implementation of the CPS are varied and concerning. Retirees are underpaid despite years of dedicated service, with some having served for the mandatory 35 years. Corruption is rampant within the system, and many state governments and employers are not complying with the provisions of the Reform Act, 2014. Labour leaders in the country have criticised the scheme as being anti-workers and retirees welfare. The Association of Senior Civil Servants of Nigeria (ASCSN) has even called for the scheme to be scrapped, labelling it as a “huge fraud.”
Similarly, we urge the Rivers State Governor, Siminalayi Fubara, to completely abolish the contributory pension scheme in the state, as it will not benefit civil servants. We are particularly concerned about the future of workers who will retire under this scheme, especially since the current legislation allowing for the Defined Benefit Scheme will be obsolete in June next year, when the contributory pension law will be effective.
Moreover, the state government is deducting and remitting workers’ contributions to the pension scheme, but failing to contribute their own counterpart funds as required by law. This action is a violation of the rights of contributors as outlined in section 4(1) of the Pension Reform Act 2014. According to this section, employers are mandated to contribute a minimum of 10 per cent of an employee’s monthly salary to their pension fund administrators. Employers are also required to deduct a minimum of eight per cent from the employee’s salary and remit it to the fund administrator.
A government that supports labour rights, like the current one, should not allow workers to suffer from a failed retirement scheme. Workers who are close to retirement age should not have to face unnecessary challenges. The failure of the scheme is evident from the number of agencies that have withdrawn from it. Therefore, it is important for the state leadership to revoke the legislation.
Unlike previous administrations that may have disregarded the experiences of workers in the state, the present government has consistently recognised and appreciated their contributions. The labour-friendly policies of this government have shown its dedication to the well-being of workers. However, the failed retirement scheme remains a critical issue that needs to be addressed.

Editorial

Charge Before New Rivers Council Helmsmen

Published

2 days ago

September 29, 2025

The Tide

On the 30th of August, Rivers people trooped out to participate in local government elections conducted across the state. These elections, which produced new chairmen and councillors for the 23 local government areas (LGAs), were organised by the Rivers State Independent Electoral Commission (RSIEC). The exercise has ushered in a new crop of grassroots leaders whose shoulders now bear the responsibility of steering the affairs of their respective councils. With the polls concluded and winners duly announced, the time has come for the newly elected officials to roll up their sleeves and begin the hard work of governance.

According to the results declared by RSIEC, the All Progressives Congress (APC) secured a dominant lead, winning chairmanship seats in 20 of the 23 local government councils, while the Peoples Democratic Party (PDP) clinched the remaining three. This outcome not only reflects the current political dynamics in the state but also places a significant weight of expectation on the shoulders of the APC-led councils to justify the confidence reposed in them by the electorate. It is imperative that political rhetoric now gives way to tangible development, especially at the grassroots level where government is felt most directly.

Following the elections, the successful chairmen were officially sworn into office by the former Sole Administrator of Rivers State, Vice Admiral (rtd) Ibok-Ete Ekwe Ibas. The solemn ceremony marked a transition from campaign promises to the reality of public service. With their inauguration complete, the time for celebration has ended; the time for delivery has commenced. The electorate now awaits meaningful action that reflects the hopes and aspirations of the voting public.

As helmsmen of their various LGAs, these leaders must quickly settle down to work. Their constituents expect them to provide direction, formulate policies, and execute programmes that will uplift communities long neglected. The local government tier is closest to the people and, as such, must rise above politicking to meet the everyday needs of the citizenry. It is not enough to occupy office; they must make their impact visibly and positively felt across their domains.

The Supreme Court ruling mandating direct allocation of funds to local governments—although not yet fully implemented—is a welcome development that underscores the autonomy of the third tier of government. Once this is operationalised, the excuses often cited for underperformance will no longer hold water. With funds directly accessed from the Federation Account, council administrations will be better empowered to meet the developmental needs of their localities, if only they manage resources judiciously and prioritise the right projects.

The onus is now on the chairmen to contribute meaningfully to the broader development of Rivers State. The state government cannot and should not be expected to do everything. Local government councils have defined responsibilities—ranging from rural infrastructure, primary healthcare, and basic education to waste management and local security—that must be adequately addressed. It is high time they stopped passing the buck and started acting as the elected leaders they are.

We extend our congratulations to all who emerged victorious in the elections. However, with this victory comes great responsibility. It is no longer about party affiliations or electoral campaigns; it is about governance. The chairmen must launch people-centred projects that will genuinely improve the lives of the rural populace—projects in water supply, road maintenance, school renovation, and youth empowerment, among others. Let their tenure be remembered for its impact, not its slogans.

Central to their mandate should be the welfare of workers. Council employees form the engine room of local governance, and their morale significantly affects service delivery. The new chairmen must ensure regular payment of salaries, staff training, and a conducive working environment. Neglecting this vital aspect will only hinder whatever grand plans they may have for their LGAs.

It is also essential to institute a robust peer review mechanism. The new LG officials should not operate in isolation; rather, they should learn from one another, share ideas, and compete constructively in a bid to outperform each other in service delivery. Healthy competition among council areas will drive innovation and foster accelerated development. Such a system will also help the public identify high-performing councils for emulation.

Given the typically short tenure of council administrations, it is crucial that they focus on projects that are realistic and impactful. Time and resources should not be wasted on white elephant ventures that are neither sustainable nor beneficial to the people. Instead, chairmen should pursue programmes that match their timelines and address immediate community needs.

Peace and security must remain a cardinal objective for all council steersmen. Regardless of who facilitated their election or what political loyalties they hold, they must ensure peace reigns in their areas. Development cannot thrive in an atmosphere of tension and distrust. These leaders must work closely with traditional rulers, youth groups, and civil society organisations to maintain law and order.

A critical understanding must also prevail—that chairmen are leaders of the people, not just leaders of political parties. They must conduct themselves as impartial administrators serving all constituents, irrespective of political affiliations. Additionally, they must work harmoniously with the state governor, who remains the leader of the state. Petty rivalries and political infighting serve no purpose in the development agenda.

Now that the elections are over and governance has begun, it is essential for these chairmen and councillors to adopt an inclusive approach. They must carry everyone along—party members and opposition alike—in their development plans. Creating division or playing favourites will only fracture communities and stall progress. Leadership at the grassroots demands fairness, equity, and a listening ear.

Rivers people have played their part by coming out to vote. The baton has now been passed to the new council helmsmen. They must seize the opportunity to leave lasting legacies in their communities. History will not judge them by the number of rallies they held or the speeches they gave, but by the quality of life they brought to their people. Let them not squander this moment.

Editorial

No To Political Office Holders’ Salary Hike

Published

1 week ago

September 22, 2025

The Tide

Nigeria’s Revenue Mobilisation Allocation and Fiscal Commission (RMAFC) has unveiled a gratuitous proposal to increase the salaries of political and public office holders in the country. This plan seeks to fatten the pay packets of the president, vice-president, governors, deputy governors, and members of the National and State Assemblies. At a time when the nation is struggling to steady its economy, the suggestion that political leaders should be rewarded with more money is not only misplaced but insulting to the sensibilities of the ordinary Nigerian.

What makes the proposal even more opprobrious is the dire economic condition under which citizens currently live. The cost of living crisis has worsened, inflation has eroded the purchasing power of workers, and the naira continues to tumble against foreign currencies. The majority of Nigerians are living hand to mouth, with many unable to afford basic foodstuffs, medical care, and education. Against this backdrop, political office holders, who already enjoy obscene allowances, perks, and privileges, should not even contemplate a salary increase.

It is, therefore, not surprising that the Socio-Economic Rights and Accountability Project (SERAP) has stepped in to challenge this development. SERAP has filed a lawsuit against the RMAFC to halt the implementation of this salary increment. This resolute move represents a voice of reason and accountability at a time when public anger against political insensitivity is palpable. The group is rightly insisting that the law must serve as a bulwark against impunity.

According to a statement issued by SERAP’s Deputy Director, Kolawole Oluwadare, the commission has been dragged before the Federal High Court in Abuja. Although a hearing date remains unconfirmed, the momentous step of seeking judicial redress reflects a determination to hold those in power accountable. SERAP has once again positioned itself as a guardian of public interest by challenging an elite-centric policy.

The case, registered as suit number FHC/ABJ/CS/1834/2025, specifically asks the court to determine “whether RMAFC’s proposed salary hike for the president, vice-president, governors and their deputies, and lawmakers in Nigeria is not unlawful, unconstitutional and inconsistent with the rule of law.” This formidable question goes to the very heart of democratic governance: can those entrusted with public resources decide their own pay rises without violating the constitution and moral order?

In its pleadings, SERAP argues that the proposed hike runs foul of both the 1999 Nigerian Constitution and the RMAFC Act. By seeking a judicial declaration that such a move is unlawful, unconstitutional, and inconsistent with the rule of law, the group has placed a spotlight on the tension between self-serving leadership and constitutionalism. To trivialise such an issue would be harum-scarum, for the constitution remains the supreme authority guiding governance.

We wholeheartedly commend SERAP for standing firm, while we roundly condemn RMAFC’s selfish proposal. Political office should never be an avenue for financial aggrandisement. Since our leaders often pontificate sacrifice to citizens, urging them to tighten their belts in the face of economic turbulence, the same leaders must embody sacrifice themselves. Anything short of this amounts to double standards and betrayal of trust.

The Nigerian economy is not buoyant enough to shoulder the additional cost of a salary increase for political leaders. Already, lawmakers and executives enjoy allowances that are grossly disproportionate to the national average income. These earnings are sufficient not only for their needs but also their unchecked greed. To even consider further increments under present circumstances is egregious, a slap in the face of ordinary workers whose minimum wage remains grossly insufficient.

Resources earmarked for such frivolities should instead be channelled towards alleviating the suffering of citizens and improving the nation’s productive capacity. According to United Nations statistics, about 62.9 per cent of Nigerians were living in multidimensional poverty in 2021, compared to 53.7 per cent in 2017. Similarly, nearly 30.9 per cent of the population lives below the international poverty line of US$2.15 per day. These figures paint a stark picture: Nigeria is a poor country by all measurable standards, and any extra naira diverted to elite pockets deepens this misery.

Besides, the timing of this proposal could not be more inappropriate. At a period when unemployment is soaring, inflation is crippling households, and insecurity continues to devastate communities, the RMAFC has chosen to pursue elite enrichment. It is widely known that Nigeria’s economy is in a parlous state, and public resources should be conserved and wisely invested. Political leaders must show prudence, not profligacy.

Another critical dimension is the national debt profile. According to the Debt Management Office, Nigeria’s total public debt as of March 2025 stood at a staggering N149.39 trillion. External debt obligations also remain heavy, with about US$43 billion outstanding by September 2024. In such a climate of debt-servicing and borrowing to fund budgets, it is irresponsible for political leaders to even table the idea of inflating their salaries further. Debt repayment, not self-reward, should occupy their minds.

This ignoble proposal is insensitive, unnecessary, and profoundly reckless. It should be discarded without further delay. Public office is a trust, not an entitlement to wealth accumulation. Nigerians deserve leaders who will share in their suffering, lead by example, and prioritise the common good over self-indulgence. Anything less represents betrayal of the social contract and undermines the fragile democracy we are striving to build.