Retired Federal Directors under the Contributory Pension Scheme (CPS) have raised serious concerns about the scheme, condemning it as a tool of exploitation that pushes retirees into poverty. The group, represented by Lawrence Ojabo of the Technical Team for Retired Federal Directors on CPS, called on the Federal Government to abolish the scheme, describing it as a form of modern-day slavery.
In a detailed statement, the retired directors criticized the CPS, accusing the Pension Fund Administrators (PFAs) and the National Pension Commission (PENCOM) of managing the scheme for their own profit at the expense of retirees. They highlighted that retirees are forced to choose between an annuity managed by insurance companies or a programmed withdrawal controlled by PFAs, which ultimately leaves them with meager monthly pensions. The directors argue that the CPS, even after the 2014 amendments, continues to deny them a fair share of their entitlements and leaves them financially stranded.
To illustrate their plight, they shared the personal account of a retiree who served in the Federal Government for 35 years, retiring in 2016 on a Grade Level 14 salary. Despite having over 6.7 million naira credited to his account upon retirement, he was only allowed to withdraw 25%, with the remainder kept by the PFA for investment purposes. The retiree now receives just 26,703.15 naira monthly—a sum that is not enough to cover basic living expenses in today’s economy, especially given the escalating cost of living and the removal of the fuel subsidy by the Federal Government, which has further diminished the value of their pensions.
The association condemned the CPS for being unjust and called for its immediate reform. They questioned the rationale behind denying retirees full access to their savings, suggesting that retirees are fully capable of managing their own investments. They also decried the absence of any adjustment in their pensions to match inflation, contrasting their plight with that of retirees under the old Defined Benefit Scheme, who have seen their pensions increased.
The retired directors made an urgent appeal to the Nigerian President, the National Assembly, labor unions, and all federal civil servants to intervene. They called for an end to what they termed the "abracadabra" practices of PENCOM and PFAs, demanding that retirees be allowed to enjoy a living pension. The association emphasized that the fight against the CPS is a call to duty for all well-meaning Nigerians and a necessary step to prevent further exploitation of retirees who have dedicated their lives to public service.
As the economic situation continues to worsen, the retired directors urge those still in active service to join their cause, warning that they too could face similar hardships under the current pension arrangements. They call on all relevant authorities to act swiftly to reform the CPS, ensuring that retirees can live with dignity and financial security in their post-service years.
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