FG Begins 100% Annual Emolument Payments to Retiring Federal Workers

The Federal Government has commenced payment of a new exit benefit equivalent to 100 per cent of annual emoluments to eligible retiring federal workers, in a move aimed at strengthening retirement security and improving the welfare of public servants.

The Director-General of the National Pension Commission (PenCom), Ms Omolola Oloworaran, disclosed this in Abuja at the 2026 Annual PenCom Media Conference. She explained that the benefit applies to eligible employees of treasury-funded ministries, departments and agencies (MDAs) who have at least 10 years of qualifying service.

She said the scheme, which took effect on January 1, 2026, provides the additional payment alongside retirees’ normal pensions, recognising their years of service and helping them make a more dignified transition from active employment to retirement.

According to Oloworaran, the first batch of 175 retirees received approximately ₦1.1 billion in August 2026.

The PenCom boss said the initiative was part of broader pension reforms designed to address longstanding challenges, including inadequate pension payments, delayed retirement benefits and accumulated liabilities owed to retirees.

She explained that the reforms had also resulted in increased monthly pensions for more than 241,000 retirees under the Contributory Pension Scheme through the Pension Boost 1.0 initiative.

Oloworaran disclosed that monthly pension payments to the beneficiaries increased from ₦12.15 billion to ₦14.83 billion, providing additional financial support to retirees facing rising living costs.

She also announced a major review of pensions for 2,116 retirees of the defunct Nigeria Social Insurance Trust Fund (NSITF), whose pensions had remained unchanged since 2005.

According to her, the review resulted in an increase of 1,173 per cent, raising their combined monthly pensions from ₦12.56 million to ₦159.95 million, while outstanding arrears totalling ₦8.7 billion were paid in full.

Oloworaran further stated that the Federal Government had cleared inherited pension liabilities through a ₦758 billion bond intervention, with payments reaching more than 957,000 beneficiaries.

She added that the commission had introduced measures to reduce delays in the payment of retirement benefits, with approvals that previously took up to 21 months now being processed within 48 hours.

The PenCom Director-General also announced plans to commence the PenCare retiree healthcare programme during the 2026 National Pension Week, scheduled for October 26 to 30.

She said the pilot programme would provide free access to essential healthcare services for 30,000 eligible low-income retirees, with plans to extend coverage to more beneficiaries.
Another initiative, the Minimum Pension Guarantee, is expected to establish a minimum level of protection for eligible retirees under the Contributory Pension Scheme.

Oloworaran said Nigeria’s pension assets had grown from ₦20.7 trillion in July 2024 to ₦31.48 trillion in June 2026, while 938,229 Nigerians joined the contributory scheme within the same period.

She also disclosed that pension fund operators had recorded ₦36.6 billion in cumulative recoveries from defaulting employers as of July 2026, warning that deductions from workers’ salaries must be remitted into their retirement savings accounts.

Speaking on behalf of the National Union of Pensioners under the Contributory Pension Scheme, Mrs Nkiru Cynthia Osisioma commended the commission for the reforms, particularly the proposed PenCare initiative, which she said would address retirees’ healthcare needs amid prevailing economic challenges.

She, however, appealed for measures to ensure that pensioners facing financial difficulties and those not covered by the programme also had access to essential healthcare services.

Similarly, a representative of pension fund administrators, Mr Saad Jijji, attributed the faster processing of retirement benefits to reforms that transferred some approval responsibilities from PenCom to pension operators.

He said the changes had improved service delivery and enabled pension administrators to process retirement benefits within 48 hours.

Jijji also called for sustained efforts to expand pension coverage, particularly among informal-sector workers, including traders, artisans, commercial transport operators and self-employed professionals.