Atiku Abubakar, the former Presidential candidate of the People’s Democratic Party in the 2023 elections, has urged the Federal Government to cease its proposed deployment of the N20 trillion Pension Fund for infrastructure development.
This call was made apparent by Finance and Coordinating Minister of Economy, Wale Edun, who disclosed the government’s plan to State House reporters after a two-day Federal Executive Council session presided over by President Bola Tinubu at the Presidential Villa on Tuesday.
Edun underscored that this move is a key component of Tinubu’s broader strategy to stabilize the economy amidst rising inflation and interest rates.
He stated “The life insurance and investment fund industry. Generally, there are offers of 20 trillion Naira available, or much of it is in short-term funding that doesn’t need to be quite sure money is long-term. People save over their lifetime for their pension.
“And so in conversation, in consultation, collaboration, and cooperation with the private sector, we are now able to announce and with the full knowledge and support of all parties, that there will be an initiative to fund growth through investment in infrastructure, including housing provision of mortgages, long term mortgages, 25-year mortgages at relatively low interest rates.”
In response, the former Vice President in a statement via his verified Facebook page on Wednesday, criticised the FG’s action as misguided.
Atiku cautioned that if not promptly stopped, the initiative could have disastrous consequences for hardworking Nigerians who rely on their pensions after retiring from service.
The statement read in part “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.
“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.
Atiku criticized the minister for failing to furnish pertinent information, such as the proportion of funds intended to be withdrawn from the Pension Funds.
It stated “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 government must be cautioned to act strictly within the provisions of the Pension Reform Act of 2014 (PRA 2014), along with the revised Regulation on Investment of Pension Assets issued by the National Pension Commission (PenCom). In particular, the Federal Government must not act contrary to the provisions of the extant Regulation on investment limits to wit: Pension Funds can invest no more than 5% of total pension funds’ assets in infrastructure investments. 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 Fund that is more than 5% of the total value of the nation’s pension fund for Mr Edun to fiddle with. There are no easy ways for Mr Edun to address the challenges of funding infrastructure development in Nigeria. He can’t cut corners. He must introduce the necessary reforms to restore investor confidence in the Nigerian economy and to leverage private resources, skills, and technology.”
