PENGASSAN WARNS OF GROWING HARDSHIP AMONG OIL AND GAS RETIREES, SEEKS URGENT PENSION REFORMS
Read Time:3 Minute, 37 Second
By Aishat Momoh. O.
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has raised fresh concerns over the worsening conditions of retirees in the oil and gas sector, blaming stagnant pension benefits and weak regulatory oversight for the hardship faced by pensioners.
PENGASSAN President, Festus Osifo, speaking on Thursday at a one-day summit themed “The Future of Pensions in the Nigerian Oil and Gas Industry” in Abuja, said many retirees under the Closed Pension Fund Administrators (CPFAs) were living in severe economic distress, as their pension payments had remained unchanged for years despite rising inflation and the steep depreciation of the naira.
Osifo noted that although the 2004 Pension Reform Act introduced the Contributory Pension Scheme (CPS), several multinational oil companies — including Chevron, NNPC, TotalEnergies and the former Department of Petroleum Resources — were allowed to retain their closed pension schemes for employees hired before 2014. New entrants were barred from the system thereafter.
Lamenting the impact of static benefits on pensioners, Osifo said many retirees who left service as far back as 1990 or 2010 now struggle to meet basic needs.
“We have observed with deep concern that many of our retirees are going through hardship because their pensions have remained static for years,” he said. “Some retired as far back as 1990 or 2010, but what they take home monthly today has lost its value due to inflation and the fall of the naira.”
According to him, about 90 per cent of CPFAs in the sector have not reviewed pension benefits for decades, leaving retirees dependent on occasional goodwill adjustments from company management.
“In about 90 per cent of the closed pension schemes, the benefits do not grow. The retirees depend solely on the goodwill of management for any increment,” Osifo added.
He urged the National Pension Commission (PenCom) to strengthen regulatory oversight, especially in actuarial assessments on funding sufficiency, life expectancy, and valuation transparency within closed schemes.
“PenCom must ensure that these funding gaps are closed, that the actuarial assessments are realistic, and that the funds are adequate to sustain pensioners and those still in service,” he said.
Osifo emphasised that the welfare of retirees should be treated as a moral obligation and a true measure of corporate integrity, noting that the union would intensify engagement with employers to correct existing imbalances.
“The people who are pensioners today were once union veterans who fought for workers’ rights. It is our duty to ensure they live in dignity. Tomorrow, we too will become pensioners,” he said.
He commended PenCom for maintaining professionalism in a challenging economic climate but urged the commission to remain incorruptible and steadfast in enforcing regulations.
Representing the Director-General of PenCom, Omolola Oloworara, the Head of Investment Supervision Department, Mr Abdulqadir Dalhatu, reaffirmed the regulator’s commitment to safeguarding contributors’ funds and improving pension adequacy for sector retirees.
Dalhatu said PenCom had introduced new compliance frameworks and supervisory mechanisms to boost transparency, governance and sustainability among CPFAs.
“Our goal is to maintain public confidence in the pension system while driving innovation,” he stated, adding that investment guidelines were being continuously reviewed to align with global best practices and protect retirees from inflation and exchange rate shocks.
In a keynote paper, Managing Director of TotalEnergies CPFA, Mr Benjamin Okeke-Agedi — represented by Chief Finance Officer Wale Olasoji — said CPFAs still possess strategic advantages due to their flexibility and ability to diversify investments globally.
Olasoji encouraged CPFAs to adopt technology, data analytics and sustainable investment models to strengthen long-term performance.
“Adopting artificial intelligence for risk analysis and integrating ESG principles will position CPFAs for relevance in the global financial ecosystem,” he said.
He added that pension funds could play a critical role in Nigeria’s energy transition by financing green housing and infrastructure projects.
Closed Pension Fund Administrators were established by several multinational corporations before the Pension Reform Act of 2004. Unlike the contributory scheme, they operate as defined benefit plans in which employers bear full responsibility for funding retirees’ benefits.
However, PENGASSAN warned that without periodic reviews, many CPFAs risk becoming unsustainable due to inflationary pressures, longer life expectancy and weak funding discipline.
Nigeria’s pension sector currently manages over N20tn in assets, according to PenCom, but concerns remain over inequality in benefit adequacy — particularly for retirees under closed schemes in the oil and gas industry.
Happy
0 %
Sad
100 %
Excited
0 %
Sleepy
0 %
Angry
0 %
Surprise
0 %
1
0