FG’s Plan To Borrow N20trn Pension Fund Against Pension Act, Atiku Warns

The 2023 Presidential candidate of the Peoples Democratic Party, PDP, Atiku Abubakar has criticized federal government’s plan to borrow Pension Funds to finance infrastructure in the country.

Atiku, a former vice president kicked against plan on his X handle on Wednesday, saying the move was against the pension fund extant laws.

His comment comes on the heels of suggestion by the Minister of Finance and Co-ordinator of the Economy that the federal government was planning to borrow the N20 trillion in the Pension Funds to fund critical infrastructure.

Reacting, Atiku this is against the Pension Reform Act of 2014 which specified that only five percent of the fund are allowed to be borrowed by the government.

He urged President Bola Ahmed Tinubu to refused to be misguided on the issue, adding that the plan should be rescinded immediately.

The former number two citizen also urged the federal government to seek other means of providing infrastructure for Nigerians, for instance,  by leveraging on foreign investment and technology.

Atiku said, “My attention is drawn to a disturbing disclosure by the Finance Minister and Coordinating Minister of the Economy, Wale Edun, as he addressed state house correspondents after the federal executive council (FEC) meeting at the presidential villa on Tuesday, 14 May.

“There is, according to the minister, a move by the federal government to rev up economic growth by unlocking N20 trillion from the nation’s pension funds and other funds to finance critical infrastructure projects across the country.

“The minister has indicated that although ‘the initiative is expected to attract foreign investment interest over time’, domestic savings are his ‘immediate focus’ for now.

“He provided no useful details, such as the percentage of the funds to be mopped up from the pension funds, for example. Even at that, this move must be halted immediately!

“It is a misguided initiative that could lead to disastrous consequences on the lives of Nigeria’s hardworking men and women, who toiled and saved and who now survive on their pensions having retired from service. It is another attempt to perpetrate illegality by the federal government,” he said.

“In particular, the federal government must not act contrary to the provisions of the extant regulation on investment limits to which Pension Funds can invest no more than 5% of total pension funds’ assets in infrastructure investments.

“I note that as of December 2023, total pension funds assets were approximately N18 trillion, of which 75% of these are investments in FGN Securities.

“There is no free Pension Funds that is more than 5% of the total value of the nation’s pension fund for Mr. Edun to fiddle with.”

Not a few Nigerians will agree with Atiku considering the mismanagement of pension funds by its administrators in recent past. Many retired workers are still struggling to receive their pensions many years after retirement, according to analysts.