in Abuja

Director General/Chief Executive, National Pension Commission (PenCom), Ms. OmololaOloworaran, has disclosed that it is partnering the Office of the Head of the Civil Service of the Federation (OHCSF) to introduce a Gratuity Framework for civil servants in treasury-funded Ministries Departments and Agencies (MDAs) under the Contributory Pension Scheme (CPS).

The development followed a high-level meeting held on June 13, 2025, in Abuja, where Oloworaran, paid a courtesy visit to the Head of the Civil Service of the Federation (HCSF), Mrs. Didi Esther Walson-Jack.

The PenCom boss said the initiative will boost retirement benefits.

She said the commission is currently working on modalities for the establishment of a Gratuity Scheme, in line with Section 4(4)(a) of the PRA 2014 for retiring employees of Federal Government treasury-funded MDAs.

The PenCom DG said the initiative had been estimated to cost the federal government only about N30 billion per annum as determined by PenCom and confirmed by the 2024 Stakeholders Committee on outstanding pension liabilities, if retiring federal employees are paid 100 per cent of their last gross annual remuneration.

She said the amount represented a modest but impactful intervention to improve the welfare of those who have served the nation with dedication.

Furthermore, the DG highlighted the persistent issue of delayed pension payments due to delay in payment of Accrued Rights.

She noted that previous collaboration between PenCom and the Office of the Head of Service yielded significant progress, including securing a Federal Executive Council (FEC) approval for a N758 billion bond to clear outstanding pension liabilities under the CPS.

Oloworaran unveiled a one-time, comprehensive online enrolment exercise to establish the accrued pension rights liability of all serving federal employees of treasury-funded MDAs who were in service prior to June 2004.

She said the online verification and enrolment exercise, which will commence from August 2025, will enable PenCom present to the federal government the amount so determined with a view to possibly raise a bond to settle the entire liability once and for all.

In a statement, the DG added that the determined accrued pension rights for every eligible civil servant will be credited into their individual Retirement Savings Accounts (RSAs).

On the benefits of the enrolment, she said retirees will start earning returns on these funds, and the system becomes shielded from political transitions, as Pension Fund Administrators (PFAs) will take full control.

Oloworaran told the Head of Service that PenCom was developing a digital application to streamline the enrolment process and which it plans to deploy the online application by August 2025.

She sought OHCSF’s support to issue a circular directing all MDAs to participate in the enrolment and submit the necessary documentation.

Speaking on the challenge of uncredited pension contributions among MDAs not enrolled in the Integrated Payroll and Personnel Information System (IPPIS), the PenCom boss said that contributions are often made without accompanying schedules.

However, she said PenCom had introduced a new Pension Contribution Remittance System that requires all employers to henceforth, utilise selected Payment Solution Support Providers (PSSPs) for the remittance of their employees’ contributions.

This, she said, will ensure accurate and prompt remittance of pension contributions into respective RSAs of employees.

In response, the HCSF, Mrs. Walson-Jack, expressed her full support for all the initiatives and commended PenCom for its proactive approach to improving pension administration.

She pledged to issue the necessary circulars to MDAs and to collaborate closely with PenCom in developing the modalities and securing the approvals for the Gratuity Scheme.

Walson-Jack said civil servants have been calling for gratuity and expressed her full backing for the proposed Gratuity Scheme.

To cement the partnership, PenCom and OHCSF agreed to establish a Standing Committee to work on the outlined reforms and address any emerging issues in the future.