Former Vice President Atiku Abubakar has queried the move by the federal government under the leadership of President Bola Tinubu to use pension funds to finance infrastructure projects.
The former Vice President described such acts as an illegality, a disturbing decision that “could lead to disastrous consequences on the lives of Nigeria’s hardworking men and women who toiled and saved and who now survive on their pensions having retired from service.”
The federal government said it aims to boost economic growth by utilising ₦20 trillion from the nation’s pension funds to finance vital infrastructure projects nationwide.
Finance Minister and coordinating minister of the economy, Wale Edun, disclosed this to State House correspondents on Tuesday after President Bola Tinubu presided over the Federal Executive Council meeting at the Presidential Villa.
He mentioned that the initiative is a crucial part of Tinubu’s comprehensive reforms aimed at stabilising the economy in the face of high inflation and interest rates.
However, in his reaction on Wednesday via a post on his X account, Atiku called on the Tinubu-led government to cancel the plan.
He argued that it is a misguided move on the part of the government.
In his words, “My attention is drawn to a disturbing disclosure by the finance minister and coordinating minister of the economy, Wale Edun, as he addressed state house correspondents after the federal executive council (FEC) meeting at the presidential villa on Tuesday, 14 May,” Abubakar said.
“There is, according to the minister, a move by the federal government to rev up economic growth by unlocking N20 trillion from the nation’s pension funds and other funds to finance critical infrastructure projects across the country.
“The minister has indicated that although “the initiative is expected to attract foreign investment interest over time”, domestic savings are his ‘immediate focus’ for now.
“He provided no useful details, such as the percentage of the funds to be mopped up from the pension funds, for example.
“Even at that, this move must be halted immediately! It is a misguided initiative that could lead to disastrous consequences on the lives of Nigeria’s hardworking men and women who toiled and saved and who now survive on their pensions having retired from service.
“It is another attempt to perpetrate illegality by the federal government.”
The former Vice President also urged the government to avoid going against the provisions of the pension reform act 2014.
“In particular, the federal government must not act contrary to the provisions of the extant Regulation on investment limits to which Pension Funds can invest no more than 5% of total pension funds’ assets in infrastructure investments,” Atiku said
“I note that as of December 2023, total pension funds assets were approximately N18 trillion, of which 75% of these are investments in FGN Securities.
“There is NO free Pension Funds that is more than 5% of the total value of the nation’s pension fund for Mr. Edun to fiddle with.”
He added that the government must do things right to regain investor confidence in the Nigerian economy and to leverage private resources, skills, and technology.
