Tinubu cautions pension managers against risky investments

President Bola Tinubu has warned pension fund administrators and custodians against exposing workers’ retirement savings to reckless investments, insisting that the pursuit of higher returns or national development must not compromise contributors’ financial security.

The President gave the warning on Thursday at the National Pension Conference and Awards, held at Transcorp Hilton, Abuja, as part of the maiden National Pension Week 2026.

Represented by the Secretary to the Government of the Federation, George Akume, Tinubu said pension assets must be managed with transparency, accountability, and strict risk-management standards.

“National development must never come at the expense of pensioners. Every investment must stand on its own merits, pass rigorous tests of risk and return, and serve the best interests of contributors,” he said.

The President maintained that although pension savings could support infrastructure development and economic growth, investment decisions must prioritise the interests of workers whose contributions constitute the funds.

He warned that inflation was already weakening the purchasing power of retirement savings, making it necessary for operators to deliver sustainable returns without compromising capital preservation.

“Inflation has quietly betrayed the very people who served them. Equally, the pursuit of return must never become an excuse for reckless risk-taking,” Tinubu said.

He urged pension fund administrators and custodians to strengthen investment expertise, diversify portfolios responsibly, reduce operating costs and improve accountability.

According to him, the performance of the pension industry should be measured by the financial security delivered to retirees rather than the volume of assets under management.

Tinubu also directed employers to remit workers’ pension contributions promptly, describing the withholding of deducted contributions as a breach of trust.

He charged PenCom to enforce pension regulations without fear or favour and called on state governments, organised labour and other stakeholders to expand coverage.

The President further disclosed that his administration had approved N738bn to address outstanding pension obligations and strengthen the Pension Protection Fund.

He announced the commencement of the minimum pension guarantee, a provision of the Pension Reform Act 2014 intended to protect retirees receiving inadequate benefits.

Speaking separately, the Director-General of PenCom, Omolola Oloworaran, disclosed that Nigeria’s pension assets increased from N20.79tn in July 2024 to N31.8tn in August 2026.

An analysis of the figures showed an increase of N11.01tn, representing approximately 53 per cent over the period.

However, she expressed concern that the expansion of pension assets had not translated into adequate retirement income for many contributors, particularly private-sector workers.

“Almost 70 per cent of private sector employees earn below the national minimum wage in retirement. More than 55 per cent of all retirees whose pensions fall below the minimum wage come from the private sector,” she disclosed.

Oloworaran attributed the problem partly to employers calculating pension contributions on limited portions of workers’ earnings rather than their full remuneration.

She explained that Nigeria’s statutory combined pension contribution of 18 per cent comprised 10 per cent from employers and eight per cent from employees, but warned that inadequate pensionable earnings weakened retirement benefits.

“Our private sector workers are retiring into poverty. This must change,” she declared.

The PenCom boss consequently urged private employers to contribute to the Pension Protection Fund alongside the Federal Government and pension industry.

She also challenged pension operators to generate returns above inflation.

“Beating inflation is not an aspiration. It is your job,” she said.

Oloworaran disclosed that PenCom had secured industry commitments to establish three million additional funded, active retirement savings accounts within the next year, targeting workers currently excluded from formal pension arrangements.

She announced that Tinubu would launch the Pension Security Initiative on November 10, incorporating the PenCare healthcare programme and minimum pension guarantee.

The director-general further directed pension fund administrators and custodians to complete their recapitalisation by June 30, 2027.

“Every pension fund administrator and custodian must complete recapitalisation by 30th June 2027. We are not changing our minds,” she warned.

Highlighting recent improvements, Oloworaran said some federal retirees had received pension increases ranging from 67 to 120 per cent, while certain Nigeria Social Insurance Trust Fund pensioners recorded increases exceeding 1,000 per cent.

She added that retired professors could now receive pensions equivalent to their final salaries, while retirement benefits were being processed within 48 hours.

The commission also announced the introduction of an exit benefit scheme for retirees from treasury-funded federal ministries, departments and agencies, with symbolic cheques presented at the event.

Meanwhile, the Chairman of the House of Representatives Committee on Pensions, Jallo Mohammed, disclosed that the National Assembly was reviewing the Pension Reform Act 2014 and other pension-related legislation.

He said the proposed amendments, including legislation concerning intelligence and military pensions, were progressing through legislative consideration ahead of public hearings.

Mohammed also disclosed ongoing engagement with NNPC Pension Fund Limited over compliance with PenCom directives following years of regulatory concerns.

He pledged continued legislative oversight to improve pension administration, strengthen regulatory compliance and protect contributors’ retirement savings.

“Our shared objective must be to build a pension industry that not only protects the savings of today’s workers, but also guarantees greater financial security and dignity for future generations of retirees,” he said.