Oshiomhole Accuses FG, States of Borrowing, Abusing Workers’ N11trn Contributory Pension Funds at Low-Interest Rate

Paschal Emeka, Abuja / Posted December 6, 2023

Former Governor of Edo State, Senator Adams Oshiomhole has claimed that the federal and state governments were borrowing funds from the over N11 trillion contributory pension fund, as a result of the very low interest rate.

Oshiomhole disclosed that the governments at all levels were ignoring loans offered by commercial banks, decried the breach in the concept of establishing the contributory pension scheme which represents a social capital workers could fall back on upon retirement, as the essence of its establishment was being eroded by the administrators.

Speaking at the 8th Quadrennial National Delegates Conference of NASU with the theme “Trade Unionism in the Era of Economic Crisis: Addressing the Increasing Poverty Level of Nigerian Workers,” on Tuesday in Abuja, the former National Chairman of the All Progressive Congress (APC), noted that the funds ought to go into mortgage investments for workers who upon retirement were supposed to have a roof over their head

“I know I resisted the idea of contributory pension to be managed by PFAs. These PFAs are profit seekers you cannot give me a 6% Return on my pension savings or yet the interest rate is 25% which means you are getting poorer. Men, you are the greatest economy you cannot accept that.

“Today, that pension scheme is over N11 trillion Naira deducted from your wages, if they put up a part of that trillion or more into mass housing, will workers remain homeless? No, because we were told that the reason we don’t have a flourishing mortgage system in Nigeria is that Nigerian banks don’t give long-term funds.

“Governors go to borrow these pension funds at a very reduced interest rate for about 6 per cent, instead of going to the banks which have higher interest rates. Because the banks say they cannot give out customers’ funds to borrowers, especially because some save at maybe two to three months and come and collect, such funds cannot be used for long-term loans.”

Oshiomhole who equally condemned in strong terms, the brutalization of the NLC President, Joe Ajaero in the Imo state, however, faulted the strike which temporarily grounded social and economic activities in the country for two days.

While advising the labour movement to always approach issues in a united front even though the government would always find ways to break or fragment them, he regretted that often times Labour leaders go to the government to seek implementation of their demands from governments with biased positions that were not well articulated, as a result, government officials gets the upper hand in the negotiations.

On the fuel subsidy policy of the government, Oshiomhole urged workers not to lament their sorry situation but to put on their thinking caps and wriggle out of the dire situation.

He said rather than spend time agonizing over government policies that were not working in their favour, they should engage as a united front to press home their demands to those in authority.

Speaking on his days as President of the NLC, he said he was able to successfully engage former President Olusegun Obasanjo to make the prices of petroleum products remain at a reasonable level for Nigerians because he was always armed with specific demands from the affiliate unions.