Ogun Unveils Additional Pension Benefit To Address CPS Concerns

The Ogun State Government (OGSG) has introduced an Additional Pension Benefit (APB) as part of measures to address concerns raised by stakeholders following the full implementation of the Contributory Pension Scheme (CPS) in the state.

In a statement shared on the OGSG official X handle, the initiative was approved by the administration of Governor Dapo Abiodun and announced in a communiqué issued after a series of consultative meetings between representatives of organised labour, members of the State and Local Government Pension Administration Committees, and the Commissioner for Finance and Chief Economic Adviser, Dapo Okubadejo.

According to the statement, the CPS became fully operational in Ogun State on July 2, 2025.

The statement revealed that the stakeholders described the APB as an innovative and sustainable mechanism designed to prevent pension crises and strengthen confidence in the CPS.

According to the communiqué, the APB is a one-off payment at retirement aimed at bridging gaps identified between the CPS and the former Defined Benefit Scheme (DBS), particularly regarding gratuity.

The statement further revealed that the benefit will be calculated using graded percentages of a retiree’s Final Total Annual Earnings (TAE), based on years of qualifying service.

Eligible retirees will receive between 116 per cent and 280 per cent of their final annual emolument as an additional benefit, depending on length of service.

The payment will be made directly to retirees at the point of exit, while balances in their Retirement Savings Accounts (RSAs) will be preserved to strengthen monthly pension payments.

The communiqué highlighted the state government’s financial interventions in the pension sector, noting that ₦26.35 billion has been expended to offset outstanding gratuity liabilities, alongside the commencement of amortisation of accrued gratuity arrears dating back to July 2012.

The communique also disclosed that ₦5.89 billion has been remitted as arrears of CPS deductions and accrued returns on investment, while ₦500 million has been paid as death benefits into the RSAs of deceased retirees.

In addition, the government has commenced remittance of accrued pension rights for eligible employees.

“Regular monthly remittances of employer and employee contributions into Retirement Savings Accounts began in July 2025, and as of January 2026, total remittances stood at ₦3.19 billion. These steps reflect the Government’s unwavering resolve to build confidence in the CPS and entrench transparency and accountability in pension administration,” the communiqué stated.

The statement further revealed that, beyond pension payments, stakeholders urged the government to leverage national pension assets for infrastructure development and affordable mortgage financing.

Under the CPS framework, contributors may access up to 25 per cent of their RSA balance as equity contribution toward residential mortgages, expanding home ownership opportunities for public servants.

The communiqué further recommended strengthening engagement with Pension Fund Administrators through more responsive communication channels, including toll-free lines, enhanced pre-retirement training programmes, publication of comprehensive Frequently Asked Questions on the CPS, and periodic electronic verification exercises to maintain accurate retiree records.

Stakeholders reaffirmed their commitment to ensuring that pension reforms in Ogun State balance workers’ welfare with long-term fiscal sustainability.