The Ogun State Government has approved a special retirement package designed to cushion pension shortfalls and strengthen financial security for workers retiring under the Contributory Pension Scheme.
The approval of the Additional Pension Benefit was disclosed after a high level meeting chaired by the Honourable Commissioner for Finance and Chief Economic Adviser, Mr. Dapo Okubadejo.
The engagement brought together labour unions, Pension Fund Administrators and members of the Pension Fund Management Committees to address concerns surrounding retirement benefits in the state.
Speaking at the meeting, the Commissioner explained that strict compliance with the Contributory Pension Scheme is mandatory and beneficial to both employees and government.
He noted that the Defined Benefit Scheme and the Contributory Pension Scheme operate on different structures, adding that the administration of Governor Dapo Abiodun remains committed to correcting gaps identified in the existing framework.
According to him, the Governor approved the Additional Pension Benefit in line with the law to provide structured support for retirees.
While gratuity was a feature under the old Defined Benefit Scheme, he said the new benefit under the Contributory Pension Scheme is structured differently in terms of computation but reflects the same spirit of providing financial relief at retirement.
He explained that the benefit would be calculated using defined service year brackets and applicable scale rates, which are generally favourable to most retiring workers.
Describing the initiative as the first of its kind in the country, the Commissioner said it was designed to boost confidence in the Contributory Pension Scheme and make retirement more secure for public servants.
Mr. Okubadejo further disclosed that the Additional Pension Benefit would run for ten years as a compensatory measure for retirees whose accrued pension obligations were not remitted promptly by previous administrations.
He said the delay had deprived affected workers of potential investment returns, stressing that the new package is intended to provide equitable relief.
On sustainability, he noted that large lump sum withdrawals often reduce the value of monthly pension income. The state government, he said, plans to seek approval from the National Pension Commission to preserve pension contributions mainly for monthly payments, while the Additional Pension Benefit would serve as a one off retirement package effective from July 2025.
He called on relevant ministries, Pension Fund Administrators and labour unions to strengthen service delivery and intensify public sensitisation. He also urged that pre retirement training programmes be organised at least six months before workers exit service.
Earlier, Permanent Secretaries from the Bureau of State and Local Government Pensions, Mrs. Arinola Adetayo and Engr. Olufisan Osiyale, said the meeting was aimed at deepening collaboration and resolving emerging issues affecting retirees.
They described the Contributory Pension Scheme as a partnership among employer, employee and Pension Fund Administrators, stressing that effective synergy remains critical to its success.
Responding on behalf of labour unions, leaders of the Nigeria Labour Congress and the Trade Union Congress of Nigeria, Mr. Ademola Benco and Mr. Akeem Lasisi, commended the Governor for what they described as a bold and worker friendly reform.
They acknowledged that concerns over the adequacy of pensions under the Contributory Pension Scheme had lingered for years, but expressed satisfaction that the new Additional Pension Benefit directly addresses those concerns.
According to them, the initiative reflects a strong commitment by the administration to protect the dignity and long term financial stability of retirees in Ogun State.
