Ogun State in southwest Nigeria has launched a comprehensive overhaul of its pension system, establishing two oversight bodies to manage retirement funds for state and local government workers. Governor Dapo Abiodun announced the formation of 25-member Pension Funds Management Committees during a ceremony in Abeokuta, framing the move as part of broader reforms to ensure sustainable benefits for public servants.
The newly constituted State and Local Government Pension Committees will operate under Nigeria’s national Contributory Pension Scheme (CPS), replacing a legacy system criticized for chronic delays, mounting liabilities, and overdependence on annual budget allocations. The governor described the previous framework as “unpredictable” and prone to “bad debts,” contrasting it with the CPS model designed to pool contributions from employees and employers in professionally managed accounts.
Key responsibilities of the committees include ensuring compliance with regulations from Nigeria’s National Pension Commission (PENCOM), monitoring Pension Fund Administrators and Custodians, and facilitating timely remittance of contributions. Additional mandates span auditing fund performance, engaging external financial experts, and improving workers’ understanding of retirement benefits. The bodies may also establish specialized subcommittees to address operational challenges.
Abiodun emphasized the reform’s legal foundation, citing Section 19 of the Ogun State Pension Reform Law (2006) and a recently signed memorandum with labor unions. “Workers who have labored for the state deserve peace of mind in retirement,” he stated, charging committee members to uphold transparency as “custodians of hopes and futures.” The governor also acknowledged labor leaders for suspending a week-long strike, calling it proof of “faith in dialogue” to resolve disputes.
The reform follows protracted negotiations between state officials and worker representatives seeking to address pension system vulnerabilities. Mrs. Arinola Adetayo will lead the state-level committee, while Engr. Olufisan Osiyale heads the local government body. In his acceptance speech, Osiyale recognized the task’s complexity but pledged collaborative implementation, stressing that “all stakeholders” must contribute to the initiative’s success.
Analysts view the restructuring as part of broader Nigerian pension reforms initiated in 2004, which shifted responsibility from government-managed defined benefits to privately managed contributory accounts. While the federal scheme covers over nine million participants, implementation varies across Nigeria’s 36 states. Ogun’s efforts to institutionalize oversight mechanisms could serve as a test case for subnational pension governance in Africa’s most populous nation.
