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This research work is designed to develop effective strategy for pension
administration in the Nigeria public sector, using pension commission as
a study. The research work reveals how some retirees are forced to
continue to work throughout their life, not out of choice but for lack of
means of sustenance at old age. The sources of data collection for this
work are primary and secondary sources, the researcher in this process of
data collection for the research regarded the questionnaire to serve as the
most important instrument used in the research, and the data gathered
from questionnaire are analyzed by simple percentage, the chi-square
techniques was employed to test the hypothesis and interpret the
information for better understanding. The findings reveal that, a noneffective and efficient strategy of pension administration can be likened
to poor pension administration and budgeted income to pensioners is not
implemented as at when due. The implication were that, committees
should be set up to audit the performance of pension boards and other
pension bodies and responsibility should be assigned to the right people
who must have access to the right information concerning retires and
also retirees should not solely depend on pension after retirement,
alternate plans should be made from day one of the start of one’s
working years, this could include setting aside a percentage of one’s
salary in anticipation of retirement.

Title Page—————————————————————-i
Approval Page———————————————————-ii
Table of content——————————————————–vi
List of table————————————————————–vii
1.0 Introduction ——————————————————-1
1.1 Background of the study —————————————-1
1.2 Statement of the problem —————————————3
1.3 Objective of the study ——————————————–4
1.4 Test of Hypotheses ————————————————4
1.5 Research Questions————————————————-5
1.6 Significance of the study ——————————————-5

1.7 Scope of the study—————————————————7
1.8 Limitation of the study———————————————–7
1.9 Definitions of terms ————————————————–8
2.0 Introduction ————————————————————10
2.1 Historical Development of Pension Administration and
reform in Nigeria ————————————————————14
2.2 Nigeria Private Sector ————————————————–17
2.3 The Udoji Pension Reforms ——————————————–19
2.4 Survivor Benefits ———————————————————28
2.5 Computation of retirement benefits ———————————-31
2.6 Factors attributable to poor pension Management in the Nigeria
public Sector ———————————————————————34
2.7 Strategies for Effective pension Administration in the Nigeria public
sector ——————————————————————————–37
2.8 The National Pension Commission {PENCOM} ————————–43

3.0 Introduction ——————————————————————–56
3.1 Research Design ————————————————————–57
3.2 Area of Study ——————————————————————57
3.3 Source of Data —————————————————————–58
3.4 Population of Study ———————————————————–59
3. 5 Determination of Research Instrument ———————————60
3.6 Sampling Procedure ———————————————————-61
3.7 Administration of Research Instrument ———————————-62
3.8 Method of data analysis —————————————————–62
4.0 Introduction ——————————————————————63
4.1 Data presentation and analysis ——————————————-63
5.1 Summary of Finding ———————————————————-80
5.2 Conclusion ———————————————————————84
5.3 Recommendations ———————————————————–85

Bibliography ———————————————————————–87
Appendix I ————————————————————————–89
Appendix ii ————————————————————————–90

Table 4.2.1 Administration and distribution of questionnaire
Table 4.2.2 Age distribution of Respondents
Table 4.2.3 Marital status of Respondents
Table 4.2.4 Position of Respondents
Table 4.2.5 Perception of Respondents as to whether a non-effective
and efficient strategy of pension Administration can be related to
inadequate Accountability of public funds
Table 4.2.6 Perception of Respondents as to whether a budgeted
income to pension are implemented
Table 4.2.7 Perception of Respondents as to the Delay in payment of
Table 4.2.8 Perception of Respondents as to whether there is any
significant effect on pensioners as a result of non-payment of pension
Table 4.2.9 Perception of Respondents as to whether a more and
effective strategy for pension administration can be ensured efficient
Table 4.10 Can non effective and efficient strategy for pension
administration can be due to poor pension Governance?
Table 4.11 is budgeted income to pensioners implemented as at when

The greatest challenge to government worldwide remains the issue
relating to pension fund management. A financial analyst called Alexandra
Forbes argues
“Pension Management, world over, has become
an increasingly great concern to most government
and countries of the world”.
And coming to Nigeria, the country was guided by a number of pension
regimes prior to the promulgation of the pension Act 2004, pension schemes
in Nigeria had been bedeviled with many pitfalls. The public service
operated an unfounded defined benefit schemes and the payment of
retirement benefits were budgeted annually. The annual budgetary allocation
for pension was often one of the most vulnerable items in budget
implementation in even where budgetary provisions were made, inadequate
and untimely release of fund resulted in delays and accumulation of arrears
of payment of pension rights. It is then obvious that, the defined benefit
scheme could not be sustained.
In the private sector on the other hand, many employees were not
covered by the pension scheme put in place by their employers and many
other schemes were not funded. Besides, where the schemes were funded,
the management of the pension funds was full of malpractices between the
fund management and the trustees of the pension board.

The scenario agitated a re-think of pension administration in Nigeria by the
then President Olusegun Obasanjo`s administration, accordingly, the
administration initiated a pension reform in order to address, eliminate and
eradicate the problems associated with pension reform act 2004.
Good times come and go, retirement is definite, and the question
therefore is “Can people still live a good life after retirement”? The nonimplementation of budgeted income to pensioners, a non-effective strategy
for pension administration is seemingly a growing problem in Nigerian
economy. Some retirees are forced to continue to work throughout their life
not out of choice but for lack of means of sustenance at old age. They are
therefore forced to go in search of menial jobs to make ends meet, since they
are not even sure of getting their pensions.
Apart from the stress associated with working at old age, how
relevant can an individual be at age 70 or 80 in the face of ever changing
knowledge brought about by advancement in technology? Besides, of what
use is life without rest at old age? Even where one is willing and able to
continue working, the opportunity for the elderly to continue working is
declining. However, it is against this backgrounds that the researcher wishes
to develop effective strategy for pension administration in the Nigeria public
First comes the layoffs then pay cuts finally a delay in the payments
of benefits due to poor policy formulation and implementation, incorrect
record keeping and inadequate accountability of public funds. The nonimplementation of budgeted income to pensioners, delay in the payment

and denial of pension accrued to pensioners leading to pensioners
protesting over non-payment of pensions and non-compliance with ethics
of public financial management.
The aims and objectives of the study are to ;-
1. To proffer solutions to the problem that brings about a non-effective and
efficient management in pension administration.
2. To identify measures and steps dealing with the issues of poor
implementation of budgeted income to pensioners.
3. To examine the quality of personnel in various pension boards.
4. To ascertain whether the administration of pension funds are done
For the purpose of the study, the following hypothesis were put
1. Ho : Non-effective and efficient management cannot be compared to
poor pension administration.
2. Hi : Non-effective and efficient management can be compared to poor
pension administration.
Ho : The budgeted income to pension are not implemented as at when
Hi : The budgeted income are implemented as at when due

1. Can people still live a good life after retirement?
2. Why poor policy formation and implementation of pension benefits?
3. Does incorrect record keeping and inadequate accountability of public
funds case delay pension benefits?
4. Does non-implementation of budgeted income to pensioner leading to
pensioners protesting over non-payment of pension?
5. Does non-compliance with ethics of public financial management cause
problem of pension?
Holistic change is required in order to create a framework that will
enable consumers have a greater financial security at old age. This study
signifies a whole lot; it is intended to find out the intrinsic and extrinsic
cause of poor pension administration. The findings will hopefully:
1. Assist the researcher that although simple in nature will
a. Effect radical improvements in the administration of pension funds
b. Deliver significant benefits to all consumers when they retire.
2. Serve as a guide to public official in charge of this administration of
pension funds to pensioners.
3. Assist the governments in setting priorities according to their social
fiscal policies.

4. Enable providers of pension, plans quickly to improve the flexibility
and appropriateness of today`s product.
However, it is the researcher`s belief that greater attention to ethical
and social responsibilities will improve the way pension funds are
managed and ministered.
This project work is concerned with an effective strategy for
pension administration in Nigeria public sector. The work will be limited
with pension commission (PENCOM) and with other relevant areas
such as pension scheme for civil servants, pension governance, Nigeria
Social Insurance Trust Fund, Contributory pension scheme.
1. Developing effective strategy for pension administration in the Nigeria
public sector (a study of pension commission) has not been an easy task due
to inaccessibility to some relevant materials most managers of government
prostrate perceived this research work as adding their companies thereby
withholding vital information.
Consequently, some staff of the pension bodies was reluctant to discuss the
subject freely.
2. Time factor is also another problem, which affected the compilation of
this work, despite the high scheme in the school; period allocated for the
project work must be strictly worked towards.

3. The incessant bombing in the country thereby posing everybody a prime
suspect also was one of the limitations.

1. PENSION: is a fixed sum paid regularly to a person, typically given
retirement from service.
2. PENSION FUND: is any plan, fund or scheme which provides
retirement income.
Pension should not be confused with severance pay; the former is made in
regular installments while the later is paid in one lump sum.
3. RETIREE: is one who has retired from active working life. Retirees
receive pension.
4. GRATUITY: is money given to an employee in return for service(s)
at retirement.
5. LUMP SUM: is a single payment for a number of separate items,
money paid in full rather than in several smaller amounts.
6. ANNUITY: is any terminating stream of fixed payments over a
specified period of time.
7. PENSION ADMINISTRATION: is the management of pension
funds and fairs.
8. PRE-REQUISITE: is a thing required as a condition for some other
things to happen or exist.

9. PUBLIC SECTOR: is the part of an economy concerned with
providing basic government services. These include services such as
Police, Hospitals, Schools, Military and Public transport.


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