Low-income pensioners in Nigeria can now withdraw their entire retirement savings or continue receiving monthly pensions, following a directive by the National Pension Commission (PenCom). The decision aligns with the implementation of the new National Minimum Wage of ₦70,000.
This update was detailed in a memo signed by the Head of Surveillance Department at PenCom, A.M. Salem. The memo, dated November 27, 2024, and obtained in Abuja, stated that the change follows Section 4.1(g) of the revised regulation on retirement and terminal benefits.
Previously, retirees were only permitted to withdraw up to one-third of their total Retirement Savings Accounts (RSAs).
The directive comes after President Bola Tinubu signed the National Minimum Wage Bill into law on July 29, 2024, raising the minimum wage from ₦30,000 to ₦70,000.
The memo, addressed to Pension Fund Administrators and Custodians, instructs them to implement the following:
Use ₦70,000, the new minimum wage, as the benchmark for processing retirement benefits.
Allow retirees whose monthly or quarterly pensions are below ₦23,333.33—one-third of the current minimum wage—to choose between withdrawing the balance of their RSA in full or continuing to receive monthly or quarterly pensions until the commencement of the Minimum Pension Guarantee.
This policy aims to provide greater flexibility and financial relief for low-income retirees in light of the economic adjustments brought by the new minimum wage.
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