PenCom Urges Sanwo-Olu to Approve Pension Increases for CPS Retirees

…Honours Lagos as Model State in Pension Reform, Pushes for Broader Collaboration

From Left: The Director General of the National Pension Commission, Ms. Omolola Oloworaran and the Lagos State Governor, Babajide Sanwo-Olu during a recent visit to the Lagos State Government House.

The National Pension Commission (PenCom) has called on Lagos State Governor, Mr. Babajide Sanwo-Olu, to approve periodic pension increases for retirees under the Contributory Pension Scheme (CPS), aligning their benefits with those of their counterparts in the Defined Benefit Scheme (DBS).

During a courtesy visit to the Governor at the Lagos State Government House on May 7, 2025, PenCom Director General, Ms. Omolola Oloworaran, made the appeal while presenting the findings of the Commission’s 2024 routine inspection of the Lagos State Pension Commission (LASPEC). She also used the occasion to thank Governor Sanwo-Olu for confirming his attendance as Special Guest at the Pension Industry Leadership Retreat holding on May 8, 2025.

Ms. Oloworaran highlighted that while Lagos State has consistently increased pensions for DBS retirees, CPS retirees have yet to benefit from similar enhancements. She urged the Governor to address this disparity, noting that CPS retirees contribute toward their retirement and should enjoy proportional increases to cushion inflationary effects.

Despite this concern, she lauded Lagos State as a national leader in pension administration, citing several milestones: prompt remittance of employee pension contributions, clearance of all outstanding accrued pension rights, a valid Group Life Insurance Policy for most public workers, and the deployment of cutting-edge ICT solutions to streamline pension operations.

The PenCom DG also recommended strategic policy measures to strengthen compliance and boost pension fund performance in the state. These included:

• Making the Pension Clearance Certificate (PCC) a mandatory requirement for companies bidding for Lagos State contracts—mirroring federal practices.
• Moving unremitted contributions from commercial bank escrow accounts into Transitional Contribution Fund (TCF) accounts managed by Pension Fund Administrators (PFAs), to maximise returns.
• Instituting an Irrevocable Standing Payment Order (ISPO) on Lagos State’s pension contributions, allowing for automatic deductions from Federation Account Allocation Committee (FAAC) disbursements to mitigate delays.

She acknowledged the state’s N600 million bailout fund to clear outstanding accrued pension rights for Lagos State University of Education (LASUED) retirees but appealed for similar intervention to settle unpaid benefits from 2023 and 2024.

Furthermore, Ms. Oloworaran encouraged the implementation of a Minimum Pension Guarantee (MPG) for Lagos CPS retirees, revealing that the Federal Government had commenced similar payments and included them in the recently approved N758 billion bond to settle pension liabilities.

Responding, Governor Sanwo-Olu reaffirmed his administration’s dedication to pension reforms and praised PenCom’s leadership for its collaborative approach. He expressed support for extending pension increases to CPS retirees and emphasised his government’s unwavering commitment to workers’ welfare.

While noting that current systems may not necessitate an ISPO, the Governor assured PenCom of Lagos State’s fiscal responsibility. He also urged the Commission to support the state’s infrastructural and developmental programmes by encouraging PFAs to invest in government-issued bonds.

With both parties expressing a strong willingness to deepen collaboration, the visit underscored Lagos State’s reputation as a beacon of pension excellence and marked another step toward improved welfare for all categories of retirees.

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