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Committee for a Workers' International

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Socialist Democracy November 2004

By Victor Osakwe

The issue of pension in Nigeria has become one of the thorniest issues in the country today with millions of retired workers all over Nigeria, living in abject poverty as a result of the failure of the pension system in Nigeria. The case of retired soldiers who have been picketing military headquarters in all state capitals and Abuja over the non-payment of their pensions is one such example, why the pension problem should be given the attention it deserves with a view to resolved it once and for all. It is therefore necessary that all actions of the working masses, both in the public and private sectors of the economy, look into the issue critically and proffer solutions rather than remain aloof and let the government and the employers association continue to feed fat on the toils of the working class under the pretext of reforming the pension scheme.

The main trust of the pensions act is to pass the control and running of pensions in the country to the private sector. In the words of Mr. Dapo Solanke, the chairman of the committee who drafted the bill that was passed to the National Assembly, it is to provide needed funds for the private sector for investment. The question then arises: if the investment fails or collapses, who will compensate the workers, whose pension has been used up? This is one of the gray areas of the new pension reform act. The position of the Pension Fund Administrator (PFA) created by the act, is simply nothing but to hand over the contribution of a retired worker to a private individual or company who uses the workers' retirement benefit any way he or she may feel like. Going by the fact that these companies can become corrupt, mismanaged and eventually collapse, what will happen to a pensioner whose PFA fails to utilize the fund correctly? This is a question the act has refused to answer. In other words, workers are left on their own when a PFA fails.

Another area where the Pension Reform Act has been very unfair to workers in the act is the increase in the salary deducted from workers to 7½%. With the constant devaluation of the workers' salary due to inflation and the unwillingness of the government and the employers of labour to increase salary and wages of a worker, it amounts to nothing but a pay cut to ask workers to deduct a whopping sum of 7½% from their salaries ostensibly to take care of their tomorrow while today is not secured. What kind of logic is this? While it is easy to ask workers to starve, to take a pay cut, the employers of labour (both government and the private sector) continue to reap the benefit of workers investments by making profit from them. It is normal that the employers of labour who benefit from the labour of his employees be the one to carry the greater burden rather than equate a worker's contribution to that of its employer. This is one of the points that show the unfairness of the new pension reform act.

Therefore, the inability of the government and other employers of labour to pay millions of pensioners their pensions and to leave them to wallow in poverty, hunger and diseases and at the same time continue to instigate reforms like the privatisation, commercialisation, deregulation, liberalisation, etc which are decimating the working class and depriving the working people of a better standard of living. The character and policy of a capitalist and imperialist inspired agenda whose primary goal is to make a few people rich while the majority continue to live in want and penury in the midst of plenty must be challenged. To do this, the working people must be prepared to lead other poor strata of the society like the peasants, market women, unemployed, students, etc to carry out a revolution that will lead to a socialist society where everybody will be guaranteed a permanent better standard of living rather than what is presently obtained.

Socialist Democracy November 2004