Budget Allocation For Pension Increases by N422bn In Four Years, but it’s still Not Enough, These are the Steps FG is taking to make things better.
Budgetary allocations for pensions, gratuities and retirement benefits have increased to N705 billion in the 2020 Budget proposal compared to the N283 billion in 2016. Besides the increase of N422 billion in four years, the Federal Government has also commenced yearly provision of N10 billion for the Pension Protection Fund.
The Director-General, Budget Office of the Federation, Dr Ben Akabueze, disclosed this during the National Executive Council (NEC) meeting of the Nigeria Union of Pensioners (NUP), held in Ibadan, Oyo State with a theme: “The fate of the elderly in a developing economy.”
Akabueze, who was represented by the Budget Manager, Mr Nuhu Mahmud Sani, stated that the improved budgetary allocations evidently shows the commitment of the present government towards addressing the plight of pensioners.
However, the DG Budget pointed out that over the years, the actual revenue had fallen short of projections, thereby impacting on the level of implementation of the planned expenditures, including pensions as conceived in the Appropriations Acts.
In his goodwill message to the NUP NEC, he said: “The Budgets as instruments of Fiscal policy of government are estimates of revenues and expenditures for the fiscal years. Over the years, the actual revenue had fallen short of projections, thereby impacting on the level of implementation of the planned expenditures (including pensions) conceived in the Appropriations Acts.
“The present administration has, however, demonstrated commitment towards ameliorating the plight of pensioners through improved budgetary allocations for pensions, gratuities and retirement benefits over the years from N283 billion in 2016 to N705 billion in the 2020 Budget proposal.
“It has also commenced yearly provision of N10 billion for the Pension Protection Fund, provision for DIA Civilian pensioners, increased allocation to Redemption Fund to clear arrears of 2017 and Payment of Nigeria Airways and Nitel Pensioners, among others.”
Akabueze further stated that the Budget Office is proposing to prioritize the release of other pension obligations to be released along with Personnel as a priority.
“Furthermore, the FGN, in consultation with the National Assembly, is planning to settle all outstanding arrears including pensions through the issuance of Bond. The Debt Management Office is coordinating the process. Distinguished stakeholders it is a fact that we can do more but the reality is that revenue which is the main source of funding of our expenditure has been performing below the desired level.” He added.
According to him, “the key to achieving a robust Budget that will enable the Federal Government live to its commitment to fully fund its arrears and future pension obligations lies in our collective efforts in supporting the administration’s drive to address the revenue problem.”