Oil Union Sounds Alarm Over Pension Crisis
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has raised serious concerns about the rapidly diminishing value of pensions received by retirees in the oil and gas sector, describing the situation as deeply troubling and unsustainable.
Retirees Struggle with Stagnant Benefits
Speaking during a stakeholders' engagement on closed pension fund administrators (CPFAs) in Abuja, PENGASSAN President Festus Osifo revealed that the union is deeply disturbed by the plight of pensioners who retired under the old defined benefit schemes. These retirees now receive stagnant benefits that have significantly lost value due to rampant inflation and the continuous depreciation of the naira.
Osifo highlighted that some retirees who left service as far back as 1990 and 2010 still receive exactly the same pension amounts today, despite Nigeria's skyrocketing cost of living that has made basic necessities increasingly unaffordable.
"We have observed with deep concern that many of our retirees are going through severe hardship because their pensions have remained static for years," Osifo stated. "What they take home monthly has lost its purchasing power due to inflation and the dramatic fall of the naira."
Call for Urgent Pension Reforms
The union leader noted that while a small number of CPFAs periodically review their benefits, approximately 90 percent do not conduct such reviews. This leaves retirees completely dependent on the goodwill of management for any adjustments to their pension payments.
PENGASSAN has called on the National Pension Commission (PenCom) and major oil companies including Chevron, TotalEnergies, ExxonMobil and NNPC to immediately review actuarial assumptions and ensure fair upward adjustments to pension payments.
Osifo emphasized that PENGASSAN would continue engaging management across the sector to push for comprehensive reforms that restore dignity to retired workers. He pointed out that many affected pensioners were once union leaders who fought tirelessly for workers' rights during their active service years.
The union president commended PenCom for its professionalism while urging the regulator to maintain transparency and strengthen oversight of CPFAs to guarantee long-term security for retirees. "We still believe PenCom remains one of the most credible regulatory institutions in the country. We urge them to stay true to that reputation and protect the interests of pensioners," he added.
Regulatory Response and Future Outlook
Representing the Director-General of PenCom, Omolola Oloworaran, the Head of Investment Supervision Department Abdulqadir Dalhatu reassured stakeholders of the commission's commitment to ensuring stability, compliance and transparency across all CPFAs.
Oloworaran announced that PenCom had introduced new supervisory frameworks to strengthen governance and protect contributors' funds. "Our goal is to maintain public confidence in the pension system while driving innovation and sustainability," she stated.
She added that PenCom is currently reviewing its investment guidelines to align with global best practices and exploring various measures to protect retirees' purchasing power amid persistent inflation and exchange rate volatility.
In a keynote address, Managing Director of TotalEnergies CPFA Benjamin Okeke-Agedi, represented by CFO Wale Olasoji, highlighted the comparative advantages that CPFAs hold in investment flexibility and global diversification.
Okeke-Agedi emphasized the critical need for CPFAs to adopt technology-driven solutions, including digital platforms, data analytics and artificial intelligence to improve operational efficiency and enhance risk assessment capabilities.
"CPFAs have the advantage of conditional approval of investments under the fund provisions, which allows for global partnerships and diversification. This provides a hedge against policy shocks and enhances long-term sustainability," he explained.
He stressed that future pension fund strategies must integrate environmental, social and governance (ESG) standards, urging employers, regulators and unions to collaborate in upholding strong governance, risk management and transparency across the sector.
Osifo reaffirmed PENGASSAN's unwavering commitment to defending the welfare of both active and retired oil workers, insisting that the union would continue pushing for reforms that strengthen benefit adequacy and ensure retirees can live their remaining years with dignity, maintaining that "injury to one is truly injury to all."
