BY NKECHi NAECHE -ESEZOBOR—The National Pension Commission (PenCom), has strongly condemned the practice of state governments withholding worker pension deductions in government-controlled treasury accounts.
The Director-General of PenCom, Ms. Omolola Oloworaran, disclosed this during the 2026 Consultative Forum for States, the Federal Capital Territory (FCT), and Licensed Pension Fund Operators (LPFOs).
She warned that while states technically have the legislative autonomy to pass their own laws, withholding monthly employee pension contributions into state coffers creates a dangerous risk for future retirees.
“You cannot be deducting funds from employees and putting them in a state account.”
“Any other governor can come on board who doesn’t even know what the point of the funds are, and then people’s monies are used for something else. That then results in pension obligations skyrocketing and a broken system in the future.”
She urged state governments to urgently adopt and execute the Contributory Pension Scheme (CPS), warning that delaying pension reforms poses a grave danger to public finances and the future security of public service workers.
While assuring that she will engage the governors and let them see the need to do the right thing by enacting their own laws and commencing their own scheme.
On the review of Pension Reform Act, she said “Right now, it is still at the engagement stage with all the necessary parties, which includes Labour, NECA, House of Representatives and the Senates are doing a whole lot of work. “Certainly , the rates of contribution will go up, but we have to make sure that all stakeholders are carried along before final implementation.’
