The Ogun State Government has approved an Additional Pension Benefit (APB) under the Contributory Pension Scheme (CPS), a measure aimed at strengthening retirement security and addressing gaps in the system.
The announcement was made at a meeting chaired by Commissioner for Finance and Chief Economic Adviser, Mr. Dapo Okubadejo, after consultations with labour unions, Pension Fund Administrators (PFAs), and Pension Fund Management Committees.
Okubadejo stressed that compliance with the CPS law is “both mandatory and beneficial,” noting that the Defined Benefit Scheme (DBS) and CPS differ fundamentally. He said Governor Dapo Abiodun’s administration is committed to closing identified gaps to protect workers’ interests.
He explained that while gratuity was a feature of the DBS, the newly approved APB under the CPS is designed in a similar spirit but with a different computation method. “The benefit will be calculated using defined service-year brackets and applicable scale rates, which are generally more favourable to most retiring workers,” he said.
Describing the APB as “the first of its kind in Nigeria,” Okubadejo said the initiative is intended to make the CPS more attractive and to ease concerns about retirement security. He added that the benefit would run for ten years as compensation for retirees whose pension contributions were not promptly remitted by past administrations.
On sustainability, he noted that lump-sum withdrawals often reduce monthly pension income. To address this, the government plans to seek approval from the National Pension Commission to preserve contributions for monthly payments, while the APB will serve as a one-off retirement benefit starting July 2025.
He urged ministries, PFAs, and labour unions to intensify sensitisation and organise pre-retirement training at least six months before workers exit service.
Permanent Secretaries Mrs. Arinola Adetayo and Engr. Olufisan Osiyale said the engagements were meant to strengthen collaboration, resolve challenges, and ensure smooth access to benefits. They described the CPS as a partnership among employers, employees, and PFAs, requiring strong synergy for success.
Labour leaders Mr. Ademola Benco of the Nigeria Labour Congress and Mr. Akeem Lasisi of the Trade Union Congress commended the governor, calling the APB “a bold and worker-friendly reform.” They said the initiative addresses long-standing concerns about pension adequacy and pledged full support, describing it as “innovative and unprecedented.”
