In a move aimed at strengthening the social security of public servants, the Ogun State Government has approved the introduction of an Additional Pension Benefit (APB) under the Contributory Pension Scheme (CPS).
The announcement was made following a high-level meeting chaired by the Honourable Commissioner for Finance and Chief Economic Adviser, Mr. Dapo Okubadejo. The gathering included key stakeholders such as labour unions, Pension Fund Administrators (PFAs), and members of the Pension Fund Management Committees, focusing on strategic improvements to the state’s pension framework.
Speaking at the meeting, Commissioner Okubadejo clarified the distinctions between the old Defined Benefit Scheme (DBS) and the current CPS, reiterating the Abiodun administration’s dedication to protecting workers’ interests. He revealed that Governor Dapo Abiodun has authorized the APB to address identified gaps within the scheme.
“The Governor has approved the introduction of the Additional Pension Benefit in line with existing laws,” Okubadejo stated. He explained that while the APB echoes the spirit of the gratuity system under the former DBS, its computation is distinct. The benefit will be calculated based on defined service-year brackets and applicable scale rates, which he noted are generally more favourable for most retiring workers.
Describing the initiative as the first of its kind in Nigeria, the Commissioner positioned the APB as a strategic move to enhance the attractiveness of the CPS and alleviate concerns about retirement security. He emphasized that the benefit is a testament to the government’s proactive approach to pension administration.
Okubadejo detailed that the APB will run for a period of ten years. It serves as a compensatory measure for retirees whose accrued pension rights were not remitted promptly by previous administrations, which in turn denied them potential investment returns. The goal, he said, is to cushion the effect of those past lapses and ensure equitable financial relief.
Regarding the scheme’s sustainability, the Commissioner noted that large, lump-sum withdrawals often reduce retirees’ monthly income. Consequently, the government plans to seek approval from the National Pension Commission to preserve core pension contributions primarily for monthly payouts. The new APB, effective from July 2025, will function as a one-off retirement benefit.
He also called on relevant ministries, PFAs, and labour unions to enhance service delivery, intensify public sensitization, and organize regular pre-retirement training programmes for workers at least six months before they disengage from service.
Earlier in the discussions, Permanent Secretarians from the Bureau of State and Local Government Pensions, Mrs. Arinola Adetayo and Engr. Olufisan Osiyale, underscored the importance of robust collaboration among employers, employees, and PFAs to ensure the seamless access to retirement benefits and the overall success of the CPS.
The announcement received a warm reception from labour leaders. Speaking on behalf of the unions, Mr. Ademola Benco of the Nigeria Labour Congress and Mr. Akeem Lasisi of the Trade Union Congress of Nigeria commended the Governor for what they termed a “bold and worker-friendly reform.”
The labour leaders acknowledged that concerns regarding the adequacy of monthly pensions under the CPS had persisted for years but expressed satisfaction that the APB effectively addresses those challenges. They pledged full support for the new structure, hailing it as an innovative and unprecedented initiative that reflects the administration’s strong commitment to the dignity and long-term financial security of workers in Ogun State.
