BY NKECHI NAECHE-ESEZOBOR—The National Pension Commission (PenCom) has announced that pension fund returns surpassed inflation as of March 2026, marking a significant milestone in restoring the real value of contributors’ savings.
The Director-General of PenCom, Omolola Oloworaran, disclosed this during her welcome remarks at the first bi-annual roundtable discussion between PenCom and the leadership of the Trade Union Congress of Nigeria (TUC).
According to Oloworaran, the achievement reflects the impact of ongoing reforms under Pension Revolution 2.0, a strategic initiative aimed at enhancing investment performance and safeguarding retirement savings against inflationary and currency risks.
As part of the reform agenda, the pension industry recently conducted a comprehensive review of its investment guidelines to strengthen long-term returns and preserve contributors’ wealth. The revised framework significantly expands the range of allowable asset classes, with increased exposure to real assets such as infrastructure investments, which serve as a natural hedge against inflation.
In addition, PenCom has introduced new investment instruments, including securities lending, repurchase agreements, and treasury bills, to deepen market participation, improve liquidity, and enhance portfolio yields.
The review acknowledged that rising inflation and exchange-rate volatility had previously eroded real pension returns, underscoring the need for a more diversified and resilient investment strategy. The updated framework is therefore designed to optimize returns while positioning pension assets to better withstand macroeconomic shocks.
“These reforms are already yielding results,” Oloworaran said, noting that pension fund returns are now approaching — and in some cases exceeding — inflation, representing a major turnaround after years of real value erosion.
PenCom is also working towards establishing a minimum pension guarantee through the Pension Protection Fund, supported by federal government contributions following the clearance of outstanding pension liabilities.
“This will enable us to establish a minimum pension for Nigerians, a critical step towards ensuring dignified retirement,” she stated.
Currently funded by PenCom, Pension Fund Administrators (PFAs), and Pension Fund Custodians (PFCs), the scheme will initially be implemented within the public sector before extending to private-sector workers as the funding base expands.
The regulator is also advocating for eventual mandatory contributions to strengthen the sustainability of the fund, a move that may require labour support amid anticipated resistance from employers.
