Commitment to Post-Service Welfare: The Lagos State Government’s Example


Benson Akintola

It is morally reprehensible for any employer to neglect or refuse to plan and cater for the retirement benefits of its employees who gave the prime of their active years to the employing institution.

William A. Ward is credited with the following epigram: “Before you speak, listen. Before you write, think. Before you spend, earn. Before you invest, investigate. Before you criticise, wait. Before you pray, forgive. Before you quit, try. Before you retire, save.”

Before the 2004 Federal Pension Reform Act, most state governments and companies in the Federal Republic of Nigeria operated under the Defined Benefits Pension Scheme, popularly referred to as the ‘Pay as You Go’ scheme. This scheme relied on methods that utilised the parameters of length of service to determine the final emoluments of employees. The benefits were thus easily calculated by employees. Broadly speaking, employees, who had spent five to nine years in service were entitled to a lump sum payment referred to as gratuity, while those who had spent 10 years and more were entitled to both the gratuity and monthly pension payment.

That model woefully failed as a result of the inability or willful refusal of employers to budget for and/or properly utilise funds to service pension obligations.

In the case of the Lagos State Government, it has planned and cater for the retirement benefits of its employees who gave the prime of their active years to the employing institution. The Lagos State Government under the amiable Governor Akinwunmi Ambode has consistently demonstrated its commitment to the post-service welfare of its officers.

The vehicle for demonstrating the commitment of the state has been the Lagos State Pension Commission (LASPEC) which was established as a corporate entity to regulate, supervise and ensure the effective administration of pension matters in the Lagos State public service. The passage of the law itself was in response to the new model and standards of pension administration formulated under the federal Pension Reform Act 2004. Without an iota of doubt, LASPEC has performed brilliantly and commendably in discharging the trust entrusted to its care.

The effective administration of pension matters in the Lagos State public service is an area where the Lagos State Government, through the instrumentality of LASPEC which has demonstrated its virtuous moral compass. Under the administration of Governor Ambode, in particular, the Lagos State Government has faithfully honoured its obligations under the Lagos State Contributory Pension Scheme Law (“the Law”). Such that, on Friday and just it the State has always done, presentation of bond certificates was made to the 38th batch of retirees from the Lagos State Public Service. This, indeed, is a milestone for our dear Lagos State.

Furthermore, it is a positive history that, the Lagos State Government has been consistently winning the National Pension Commission’s award for the Best Pensions Compliant State in the Federation. We aim to maintain this rating by continuing and improving on the timely payment of all pensions and other applicable benefits to our retiring workers upon disengagement from service.

LASPEC has also been responsible for the fulfillment of the wider objectives of the Law as espoused under section 4 of the Law. These include the assistance of all persons in the employment of the State Government to save towards their retirement; ensuring that persons who leave or retire from the Public Service of the state receive their terminal or retirement benefits as and when due; establishing and monitoring the adherence to the rules and regulations for the administration and payment of retirement benefits in the Public Service of the state; establishment of the group life policy in respect of death benefits for employees who die while in service; administration of Retirement Bonds for employees with past service benefits; and establishment and maintenance of the Redemption Fund from which the liability of the bond payments would be made.

In the implementation of these schemes by the Lagos State Government through LASPEC, it is on record that successes have been recorded. In spite of the onerous funding obligations under the Contributory Pension Scheme (CPS), the administration of Governor Akinwunmi Ambode has been dogged in meeting the funding obligations.

The state government has never failed to remit monthly contributions into the Retirement Savings Account (RSA) of workers and, as at March, 2017, about N78,592 billion had been credited into employees’ Retirees Savings Accounts maintained by our 10 (Ten) Pension Fund Administrators.

The state has also been consistent in setting aside funds for the payment of accrued rights as provided for in the Pension Reform Law such that the state government has paid accrued pension rights of about N61 billion since the commencement of the Retirement Benefit Bond Certificate Presentations in 2010. Last week Friday, a total number of 311 retirees will have their RSAs credited with accrued pension rights of N1.6 billion, made up of gratuity and pension benefits under the Defined Benefit scheme for employees who transited into the Defined Contributory Scheme.

With the institution of such elaborate schemes by the state government, it is not surprising that retiring public officers now look forward to retirement with more confidence and joy. This is how it should be. The state government through LASPEC will continue to ensure that public service retirees not only get what is due to them statutorily, but also continue to receive, through other agencies and programmes further and additional support and assistance that will add value to their lives in retirement.

Among others promises, Governor Ambode in his inaugural speech said: “I shall run an open government of inclusion that will not leave anybody behind. No matter your age, sex, tribe or any other status as long as you reside in Lagos, we will make Lagos work for you.” Thus, Lagos State retirees can take joy in the fact that they are not, and will not be left behind in the scheme of things by the state government under Governor Akinwunmi Ambode.

The retirees have all served in various capacities and sectors to make life better for the people of the state and, in retirement, the state’s commitment is to assist them in making the right choices that will enable the attainment of financial comfort during retirement. They must embrace the joys and challenges of this new phase of life. One thing that will stand you in good stead is the readiness to take advise from competent and reliable sources. In this respect, the retirees are enjoined to contact LASPEC or even the Ministry of Establishments, Training and Pensions should they require clarifications or advice regarding the modalities surrounding their retirement matters.

Akintola, is the Lagos State Commissioner for Establishments, Training and Pensions