The Federal Government claims that in order to pay off accrued pension debts, it will sell bonds totalling N758 billion.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, told reporters in Abuja on Tuesday that this covers debts outstanding under the previous Defined Benefit Scheme prior to the implementation of the Contributory Pension Scheme in 2004.
“An equally important issue of social interventions is pensions. There was approval for the government, through the Debt Management Office, to raise a Federal Government Bond of about N758bn, he said.
“That is to clear up the backlog of pension liabilities owed various categories of pensioners who are owed funds under the defined benefit system that preceded the defined contributions, the Contributory Pension Scheme that came into force in 2004 and was updated with a new act in 2014.
“There were some accrued liabilities which were building up over time.
“So, for example, someone who was on the defined benefit scheme yet to retire would need a top-up of their contributions or the amount due to them every time there was a wage increase, every five years or so.
“This liability built up to a point where it would not be easy to pay them down on an ongoing basis.
“So, to clean up that critical area and to give people their right, which is the payment of their pension liabilities as and when due, the government has put in place an approval for Debt Management Office to raise N758bn that will pay down all these liabilities and of course, be a tremendous relief to the beneficiaries.”
In addition, he said, “We had a €30m long-term concessional financing by a French Development Agency, which is supporting student housing in conjunction with Family Homes Fund Limited as the partner and implementer.
“It is for student tertiary accommodation at project sites throughout the country to provide sustainable and clean energy based accommodation for students, we all know what an important intervention that is for the educational sector and students, given the shortage.”
The Minister also declared that the FG has approved the National Single Window Project, a plan to increase the efficiency and competitiveness of Nigeria’s exporting procedures.
“It also speaks to increasing government revenue. So it’s both on the fiscal side, it is both revenues earned in terms of foreign exchange and government revenue.
“It speaks to the increased productivity of the Nigerian economy, as I said before, increased international competitiveness at a time where under the African Continental Free Trade Agreement, Nigeria is pushing to be a big player, both in the ECOWAS region and the African continent.
“Why is this particularly important? We are all seeing that the world is moving away from open trade, from the rules-based world trade organization led world trading environment to a more closed environment, and so the regional and the continental markets will be that much more important for Nigeria.”