In a decisive move to strengthen retirement security, the Ogun State Government has approved an Additional Pension Benefit (APB) for workers and retirees under the Contributory Pension Scheme (CPS), signaling a major shift in the state’s pension administration framework.
The approval followed a strategic stakeholders’ meeting chaired by the Commissioner for Finance and Chief Economic Adviser, Mr. Dapo Okubadejo. The engagement brought together representatives of labour unions, Pension Fund Administrators (PFAs), and Pension Fund Management Committees to address concerns surrounding pension implementation and retirees’ welfare.
Addressing participants, the Commissioner reaffirmed that strict compliance with the CPS law remains both a statutory requirement and a financial safeguard for employees and the government. He clarified that although the former Defined Benefit Scheme (DBS) provided gratuity payments, the CPS operates under a different funding structure. However, the present administration under Governor Dapo Abiodun has resolved to close existing gaps to ensure fairness and sustainability.
Okubadejo explained that the newly approved APB mirrors the spirit of gratuity but differs in its calculation methodology. The benefit will be determined using structured service-year brackets and applicable salary scale rates, which he said are generally advantageous to most retirees.
Describing the initiative as innovative, he noted that the APB is the first of its kind in Nigeria, crafted to enhance the attractiveness of the CPS and restore confidence among public servants. The benefit will run for ten years as a compensatory intervention for retirees affected by delayed remittance of accrued pension rights by previous administrations — a lapse that denied them potential investment growth.
To protect long-term sustainability, the Commissioner disclosed that the state would seek approval from the National Pension Commission (PenCom) to ensure pension contributions are preserved primarily for steady monthly payouts. The APB, he said, will function as a one-off retirement benefit, effective from July 2025, thereby cushioning the financial transition into retirement without undermining monthly income stability.
He urged ministries, PFAs, and labour unions to intensify awareness campaigns and institutionalise pre-retirement training programmes at least six months before employees exit service.
Permanent Secretaries in the Bureau of State and Local Government Pensions, Mrs. Arinola Adetayo and Engr. Olufisan Osiyale, emphasised that sustained collaboration among employers, employees, and PFAs remains central to the effectiveness of the CPS. They noted that the engagement was aimed at strengthening operational synergy and resolving emerging challenges.
Labour leaders — Mr. Ademola Benco of the Nigeria Labour Congress and Mr. Akeem Lasisi of the Trade Union Congress — commended the state government for what they described as a progressive and worker-focused reform. They acknowledged long-standing concerns over pension adequacy and expressed confidence that the APB would significantly improve retirees’ financial outlook.
The initiative, stakeholders agree, represents a strategic reform designed to reinforce workers’ welfare, financial dignity, and retirement stability in Ogun State.
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