The Nigeria Labour Congress has warned of a nationwide strike if the Federal Government does not refund what it claims are billions of naira that were taken from workers' insurance premiums. Additionally, it required the government to appoint a replacement for the head of the nation's pension regulation commission within a week. The NLC accused the Federal Government of embezzling 40% of the Nigeria Social Insurance Trust Fund donations into the national treasury. The fund, which is funded by millions of workers' payroll deductions, is intended to safeguard them in the case of an accident or termination of employment.
The National Pension Commission, however, fought against allegations of stolen money and maintained that the Contributory Pension Scheme is safe and still expanding. In a statement released on Thursday, NLC President Joe Ajero stated, "The Central Working Committee of the NLC expressed outrage at the ongoing assault on workers' social protection rights through the Federal Government's diversion of 40 percent of workers' contributions to the national coffers as revenue, in flagrant violation of the statutes establishing the NSITF."
The union pointed out that the action deprives the NSITF of its safety net function and violates the legislation that created it. Labour said, "Pension funds are deferred wages, not government revenue," and threatened to go on strike if there was any more meddling.
The government's refusal to establish a governing board for the National Pension Commission, which left the administration in complete control of billions of dollars' worth of retirement funds, was also criticized by the group.
According to the union, the void increased the likelihood of poor management and political meddling in the pension industry.
The stalemate coincides with nationwide disagreements over pension administration. Citing a 17-year backlog of unpaid payments totaling more than N82 billion, a coalition of labor unions in Ogun State urged state officials 72 hours in July to block the planned deployment of a contributory pension program. They demanded a wait until the debts are paid off or a return to the previous pension scheme.
According to the communiqué, PenCom must produce a comprehensive status report of pension funds and have its Governing Board established within seven working days, while the NSITF must return all diverted funds.
It hinted at the potential for widespread strikes and protests by threatening that the NLC would no longer guarantee industrial peace if these demands were not fulfilled.
Ibrahim Buwal, the head of PenCom's corporate communications department, responded to the union's allegations, stating that the Federal Government, not the regulator, is responsible for appointing a governing board.
He said that the commission is still reviewing the NLC communiqué and stated that "the board issue is not an agency issue; it is for the Federal Government, so we are not in a position to comment on that."
Regarding pension asset security, he insisted that funds under the Contributory Pension Scheme are safe and will keep increasing.