The National Pension Commission (PenCom) has faulted 25 states of the federation for non-compliance with the contributory pension scheme (CPS) in the country.
The commission’s latest report also revealed that only 11 states have fully domesticated CPS. These are Lagos, Federal Capital Territory (FCT), Osun, Kaduna, Ekiti, Edo, Ondo, Delta, Benue, Anambra and Jigawa.

PenCom urged states that are yet to make legislation to domesticate the scheme to do so to avoid creating financial trouble for their workers in the future. The report also said that the compliant states have set the benchmark for sustainable pension administration by ensuring that retirees receive their entitlements promptly.

It stated this in the commission’s latest report, which also called on the 774 local government areas (LGAs) to domesticate the scheme, warning that continued delays risk exacerbating long-term pension liabilities and placing unsustainable financial burdens on future administrations.

In 2006, the National Council of States adopted the CPS for all states and local governments. To support the adoption, PenCom developed a model state pension law, enabling state governments to modify it according to their unique needs.

For a state to implement the CPS in full, the state is required to enact a law on CPS, establish a pension bureau, register its employees with pension fund administrators (PFAs) and commence remittance of pension contributions.

Such a state is also required to carry out actuarial valuation, commence funding of accrued pension rights, procure group life insurance for its employees and open and fund a retirement benefits bond redemption fund account with the Central Bank of Nigeria (CBN) or PFA.