‘Why Buhari must stop borrowing of N17 trillion from pension funds’

• SERAP gives ultimatum, threatens court action
The Socio-Economic Rights and Accountability Project (SERAP) has urged President Muhammadu Buhari to stop the 36 state governors from borrowing and/or withdrawing N17 trillion from the pension funds purportedly for infrastructural development.

In an open letter sent to President Buhari, the group urged him to urgently instruct the director-general and board of the National Pension Commission (NPC) to stop the state governors.

The governors, last week, reportedly proposed to borrow around N17trillion from the pension funds after receiving a briefing from the Kaduna State governor, Mallam Nasir el-Rufai, who is the Chairman of the National Economic Council Ad Hoc Committee.

But in the letter dated December 5, 2020, and signed by SERAP’s Deputy Director, Kolawole Oluwadare, the organization said: “Allowing the governors to borrow from pension funds would be detrimental to the interest of the beneficiaries of the funds, especially given the vulnerability of pension funds to corruption in Nigeria, and the transparency and accountability deficits in several states.

“It is patently unjust and contrary to the letter and spirit of the Nigerian Constitution 1999 (as amended), the Pension Reform Act, and the country’s international anti-corruption and human rights obligations for the Federal Government and state governors to repeatedly target pension funds as an escape route from years of corruption and mismanagement in Ministries, Departments and Agencies [MDAs].”

SERAP expressed “serious concerns that the proposed borrowing by the 36 state governors from the pension funds would lead to serious loss of retirement savings of millions of Nigerians.”

The letter copied to the Attorney General of the Federation and Minister of Justice, Mr. Abubakar Malami (SAN), read in part: “This proposed borrowing faces the risks of corruption and mismanagement, and would ultimately deny pensioners the right to an adequate standard of living and trap more pensioners in poverty. Rather than devising ways to address pensioners’ poverty, governments at all levels would seem to be pushing to exacerbate it.

“Allowing the governors to borrow money from the pension funds would amount to a fundamental breach of constitutional provisions, the Pension Reform Act, and Nigeria’s international obligations, as well as fiduciary duties imposed by these legal instruments on all public officers to prevent pension funds from unduly risky investments, and to ensure transparency and accountability in the management of pension funds.”

The group gave the President 14 days to indicate the measures being taken to stop the planned borrowing and withdrawal of any money from the pension funds.

“If we have not heard from you by then as to the steps being taken in this direction, the registered trustees of SERAP shall take all appropriate legal actions to compel your government to implement these recommendations in the interest of millions of Nigerian pensioners.

“It would also be very difficult to hold state governors to account for the spending of pension funds, as states have persistently failed to account for the spending of public funds including security votes.”