The House of Representatives has passed a motion calling for an urgent and comprehensive review of Nigeria’s Contributory Pension Scheme, citing widespread hardship, low pension payouts and rising poverty among retirees.
The motion, sponsored by Afuape Moruf Afolabi, was unanimously adopted on Wednesday, December 10, 2025. Lawmakers acknowledged that the scheme, established under the Pension Reform Act of 2004 and amended in 2014, was designed to guarantee retirement security for Nigerian workers but warned that it is no longer meeting that objective.
Members of the House expressed concern that pension payments under the scheme are too small to sustain retirees amid rising inflation and living costs. They also criticised the structure that allows retirees to access only 25 per cent of their savings as a lump sum, while the remaining 75 per cent is managed by pension fund administrators, often yielding returns viewed as inadequate by beneficiaries.
The House further raised issues around transparency in pension fund management, noting that poor disclosure and weak accountability have fuelled distrust among retirees. Lawmakers also pointed to disparities between retirees under the contributory scheme and those under the older defined benefit scheme, describing the gap as unfair and inequitable.
In its resolutions, the House urged the Ministry of Labour and Employment to work with relevant stakeholders to reform the pension framework and establish a system that is fair, sustainable and capable of guaranteeing dignity in retirement. It also called on the National Pension Commission to strengthen oversight of pension fund administrators through stricter regulation, improved transparency and measures that ensure fair investment returns in the interest of retirees.
Lawmakers further urged the commission to tackle the persistent problem of employers failing to remit pension contributions, recommending tougher penalties to enforce compliance. In addition, the House mandated its Committee on Pensions to investigate the shortcomings of pension fund administration and report back within four weeks to enable further legislative action aimed at improving retirees’ welfare.
