For a while now, retirees of the Nigerian Police Force have appealed to the National Assembly to pass the Police Pension Bill, which would exclude them from the Contributory Pension Scheme (CPS). Without trying to stoke false optimism, it looks like they’ve finally gotten the answers to their prayers.
What is the latest on the Police Pension Bill?
On Tuesday, May 6, the Senate passed the Bill to establish a Police Pension Board. This Bill excludes members of the Nigerian Police Force from the CPS and returns them to the Defined Benefit Scheme (DBS).
The “Defined Benefit” pension scheme means the government is solely responsible for paying pensions to retirees. Under this scheme, retirees are entitled to a specific amount based on their years of service, retirement age, and terminal salary, as opposed to the Contributory Pension Scheme introduced in 2004, where the employer and employee contribute monthly pension and retirement benefits. Initially, as part of pension reforms under the Pension Reform Act of 2004, the government transitioned police officers to the Contributory Pension Scheme, which also includes all public servants.
Why did police officers want this Bill in the first place?
Before now, the Nigeria Police Pension Office (NPPO) oversaw the payment of pensions and gratuities to retired police officers. And they functioned under the National Pension Commission (PenCom), the pension administrator for retirees under the Contributory Pension Scheme (CPS).
However, over the years, the NPPO has been plagued with cases of corruption and mismanagement. In 2013, a High Court in Abuja sentenced Yakubu Yusuf, a Director of the Police Pension Office, to six years imprisonment or the option of a fine of ₦750,000 for spending ₦23.3 billion meant for pensioners for personal use.
In 2020, six public officials were re-arraigned by the Economic and Financial Crimes Commission (EFCC) in a High Court in Abuja over their involvement in a ₦64.6 billion police pension scam.
And beyond the corruption in the NPPO, police officers say the CPS system has faults that have impoverished the lives of police retirees, as the retirement benefits are meagre compared to what would have been received under the DBS. The level of trust in the system is low.
For instance, an Assistant Superintendent of Police (ASP) and a Deputy Superintendent of Police (DSP) take home #25,000 and ₦29,000, respectively, as a monthly pension. In contrast, officers in the same rank under the Defined Benefits System would receive between ₦106,000 and ₦120,000 as their monthly pension. DBS covers pensioners who existed before the Pension Reform Act of 2004 was enacted.
Reactions to the Bill
So far, PENCOM, the Pension Fund Operators Association of Nigeria, and other stakeholders oppose the new Bill, claiming it’ll cost the federal government about ₦ 2 trillion in pension liabilities to cater for 300,000 police officers.
On the other hand, Alkali Baba, the representative of the Deputy General of Police, Sanusi Lemu, says that the new Bill would boost the morale of police officers treated unfairly under the CPS.
There is a strong shared sense of optimism among police officers about this bill, believing that it has the potential to redefine policing in a positive manner and enhance the lives of both active officers and retirees. We hope this legislation will enable police officers to live and work with greater ease and an improved quality of life, particularly for retirees.
