The National Pension Commission (PenCom) has approved a significant upward review of pension benefits for retirees under the Nigeria Social Insurance Trust Fund (NSITF), marking the first adjustment in 21 years and ending a prolonged freeze that had severely eroded retirees' purchasing power amid persistent inflation.
The decision, approved by PenCom Director-General Ms. Omolola Oloworaran, affects 2,116 retirees and boosts their combined monthly pension payments from ₦12.56 million to ₦159.95 million. This represents an unprecedented 1,173 per cent enhancement in the aggregate monthly payout, directly addressing long-standing grievances over stagnant benefits since the last review in 2005.
Individual retirees stand to benefit substantially from the adjustment. In one documented case, a pensioner's monthly payment rose from approximately ₦18,000 to ₦206,000, a dramatic increase that restores meaningful income support for living expenses, healthcare, and family needs. Across the group, many who previously received low fixed amounts will now see payments exceed ₦200,000 monthly, providing much-needed relief in Nigeria's high-cost economic environment.
In addition to the revised ongoing pensions, PenCom authorised the immediate settlement of ₦8.7 billion in accumulated pension arrears. This translates to average lump-sum payments of about ₦3 million per retiree, with some individuals receiving over ₦8 million in back payments depending on their entitlement duration and original benefit levels.
The approval aligns with provisions in Nigeria's pension laws mandating periodic reviews to account for economic realities such as inflation and cost-of-living adjustments. PenCom highlighted that the failure to implement increases over two decades had disproportionately impacted NSITF beneficiaries, whose benefits had lost substantial real value despite rising prices for food, housing, utilities, and medical care.
The adjustment was made feasible by robust growth in the NSITF fund, which expanded from ₦54 billion in 2005 to ₦195 billion by the end of 2025. This substantial accumulation—driven by contributions, investment returns, and improved fund management—ensured that the enhanced benefits and arrears settlement could be funded without jeopardising the scheme's long-term actuarial sustainability.
PenCom described the move as a milestone in President Bola Ahmed Tinubu's administration's commitment to improving retiree welfare under the Contributory Pension Scheme. The NSITF, originally established to provide social insurance for private-sector workers, has faced criticism for outdated benefit structures and administrative delays. The 2026 review demonstrates PenCom's resolve to enforce statutory obligations and rectify historical inequities.
Retirees and pensioner associations have long protested the stagnation, with demonstrations and advocacy highlighting how low payments forced many into poverty or reliance on family support. The announcement has been widely welcomed as a step toward restoring dignity and financial security for elderly Nigerians who contributed to the economy during their working years.
The enhanced payments and arrears are expected to be disbursed promptly through existing pension administration channels, with PenCom coordinating with NSITF to ensure smooth implementation. Beneficiaries will receive notifications and updated payment schedules in the coming weeks.
This development comes amid broader pension sector reforms under PenCom's leadership, including improved oversight of Pension Fund Administrators (PFAs), enhanced transparency in fund investments, and efforts to increase coverage under the Contributory Pension Scheme. The NSITF review complements these initiatives by focusing on legacy beneficiaries who operated under pre-2004 defined benefit arrangements.
Stakeholders, including labour unions and retiree groups, have praised the decision as long overdue but timely, especially given Nigeria's inflationary pressures and the rising cost of living. The average arrears payout of ₦3 million provides a meaningful buffer for immediate needs, while the monthly increases offer sustainable income support.
PenCom reiterated that the fund's growth and prudent management provide a solid foundation for future adjustments, ensuring retirees' benefits remain aligned with economic conditions. The commission encouraged all stakeholders to support ongoing reforms to strengthen pension security nationwide.
For the 2,116 affected retirees, the approval brings closure to a 21-year wait and renewed hope for a dignified retirement. As disbursements begin, the move is seen as a positive signal of government responsiveness to pensioner welfare in an era of economic challenges.
