Pension Commission has said that the private sector contributed 47.76 per cent of the country’s pension fund of N10.95 trillion as at the end of the second quarter of 2024. According to the Commission while the private sector contributed N5.23 trillion, the public sector contributed slightly more, at N5.72 trillion. Private sector contribution represents an increase of 32.07 per cent when compared to the N3.96 trillion recorded in Q3 2022. In the same vein, the public sector saw an increase of 33.96%, up from N4.27 trillion in Q3 2022. These figures were revealed to the public by Oguche Agudah, Chief Executive Officer of Pension Fund Operators Association of Nigeria (PenOp), at the annual Pension Correspondents Association of Nigeria (PenCAN) conference in Abuja. The pension industry in Nigeria has experienced remarkable growth in total assets under management (AUM) over the years. In 2007, AUM stood at N815.18 billion, and by July 2024, it had surged to N20.87 trillion—a 2,459% increase over 17 years.
Both public and private sector contributions have trended upward, with private sector contributions growing from N454.95 billion in Q3 2011 to N5.23 trillion in Q2 2024, a more than tenfold increase. Public sector contributions also grew steadily from N1.57 trillion in Q3 2011 to N5.72 trillion by Q2 2024. Between 2019 and 2024, private sector contributions saw a 86.12% growth, from N2.81 trillion to N5.23 trillion.
In the same period, public sector contributions grew by 105.04%, from N2.79 trillion in Q3 2019 to N5.72 trillion in Q2 2024. During his presentation, Agudah said: “The collaboration between public and private sectors is driving the pension industry to new heights, and we are seeing the results in terms of assets and contributions.” Payouts from programmed withdrawals and life annuities have also seen a sharp rise. By Q2 2024, a total of N1.12 trillion had been paid to 357,310 retirees through programmed withdrawals, a substantial 26.3% increase from N887.6 billion paid to 315,112 retirees in Q3 2022. Similarly, the life annuity payments reached N1.1 trillion in Q2 2024, compared to N789.14 billion in Q3 2022—a 39.5% increase. These growing payouts are a reflection of the rising number of retirees benefiting from the pension system.
Furthermore, death benefits paid out to the beneficiaries of deceased employees have risen significantly. By Q2 2024, a total of N451.2 billion was paid to 104,259 beneficiaries, representing a 143% increase compared to the N186.21 billion paid to 59,057 beneficiaries in Q3 2022.
In the housing sector, the pension scheme is also making significant inroads. By Q2 2024, equity contributions for residential mortgages had been approved for 5,276 applicants, with payments amounting to N47.13 billion. This is a more than twofold increase compared to Q3 2023, where 746 applicants were approved for N18.98 billion.
Speaking at the conference, the acting Director-General of the National Pension Commission (PenCom), Ms Omolola Oloworaran, represented by the Head of Corporate Communications, Ibrahim Buwai, said that the federal government’s outstanding pension liabilities under the Contributory Pension Scheme (CPS) will soon be cleared. She said that the commission had successfully computed the backlog of pension liabilities owed by the federal government, and efforts are underway to address them promptly. However, the National Union of Pensioners (NUP) expressed concerns over some key issues, such as the lack of periodic adjustment of pensions for retirees. The union claims the existing issues have made the Nigeria Police Force to seek an exit from the CPS.