Oyo embraces Contributory Pension Scheme

To address accumulating pensions and gratuities which currently stands at N55.998 billion, serving and retired workers of the Oyo state government are to key into the Contributory Pension Scheme.

This pension scheme to replace the Defined Benefits Scheme which currently operates in the state, would see the employee contribute about seven per cent while the employer commits about 10 per cent to the scheme.

This development informed a sensitization workshop held at Secretariat, Ibadan, on Thursday, on the implementation of the contributory pension scheme in Oyo state.

According to state Commissioner for Finance and Budget, Mr Bimbo Adekanmbi, the state considered the contributory pension scheme imperative owing to increasing number of retirees as against the income of government.

He stated that the state government released about N150 million for retired state workers and N50 million for local government pension monthly, yet arrears had accumulated to over N55 billion.

Furthermore, he noted that despite pension constituting 21.09 per cent of the total salary/emolument bill monthly, the state pension owed was N23.48 billion and local government pension was N32.52 billion.

Adekanmbi assured of the state government’s commitment in committing some budgetary allocation to the fund.

State Head of Service, Mr Soji Eniade sought the cooperation of labour unions in ensuring the implementation of the scheme.

He called on employees and employers to make requisite contribution to the scheme.

Mr Murtala Moddibo of the National Pension Commission (PenCom) said the contributory pension scheme was imperative for governments else the burden of pensioners supersede that of current workers.

He noted that it had was no longer fashionable for governments to make yearly budgetary provision for payment of pensions and gratuities.

Oyo Chairman of Joint Negotiating Council, Mr Emmanuel Ogundiran wondered how the scheme would work with the state owing gratuities up to about 50 months.

Ogundiran admonished the inter-ministerial committee set up to implement the scheme to avoid the pitfalls of some other states who had embraced the scheme.