Pension Lifeline: FG Moves N23tn to Tackle Poverty, Boost Growth

Pension Lifeline: FG Moves N23tn to Tackle Poverty, Boost Growth

Pension funds in Nigeria, worth over N23 trillion, are now at the center of the federal government’s ambitious push to drive economic growth and reduce poverty.

The government wants to unlock these massive savings and invest them in projects that directly impact Nigerians—like roads, power, homes, and digital infrastructure.

Finance and Economy Minister Wale Edun shared this vision at the 2025 Pension Industry Leadership Retreat held in Lagos. He called on stakeholders to rethink how the country uses its growing pension assets.

Speaking to top players in finance and pensions, Mr. Edun said the pension industry has what it takes to fuel national development—without endangering the future of retirees.

“We must harness the transformative power of pension funds to support sustainable growth—without compromising the security of retirees’ savings,” he said.

Pension assets now make up about 8.6% of Nigeria’s GDP. But much of this sits in low-risk investments with little direct impact on the economy.

Mr. Edun wants that to change. He said pension funds could help fix Nigeria’s real problems—like poor infrastructure, energy shortages, and a lack of affordable housing.

Although Nigeria’s Contributory Pension Scheme (CPS) is seen as one of the strongest in Africa, he admitted the country still lags behind global pension benchmarks.

The Minister pointed to recent improvements in the economy. Nigeria recorded a 3.84% GDP growth in the first quarter of 2025. Foreign reserves have improved, and the exchange rate has become more stable. But this, he said, isn’t enough.

“To reduce poverty and create meaningful opportunities, we need to achieve a growth rate of at least 7 percent annually,” he added.

Mr. Edun stressed that Nigeria’s national budget currently represents just 10% of GDP. That’s too low to drive meaningful change. He argued that pension funds must step in to fill the funding gap in the real sector.

He assured Nigerians that the government would never gamble with pension savings. Instead, it wants to make safe and strategic investments that both protect the funds and grow the economy.

The Federal Ministry of Finance backed this stance in a statement on Sunday. It said the government is eager to work with the private sector to fully unlock the power of pension capital.

“By strategically deploying pension assets, Nigeria can unlock new opportunities for economic growth, job creation, and improved living standards,” the statement read.

For many everyday workers, the move could change how they view their retirement savings. These funds, once seen as distant security, may soon become tools that build local hospitals, schools, roads, and more.

Experts agree this step is long overdue. They say Nigeria must find a way to let pension savings do more than sit idle. But they also warn that transparency and trust will be key.

President Bola Tinubu remains committed to building an inclusive and resilient economy, one where financial institutions serve both profit and people. The plan to invest pension funds is part of that bigger picture.

While the opportunity is great, so are the risks. Citizens will expect clarity on where the money goes and how it’s protected.

Still, many believe this strategy, if well-managed, could lift millions from poverty. It could also create jobs, support local industries, and build real wealth—not just on paper, but in people’s daily lives.

The success of this plan will depend on how quickly and safely the government can turn pension funds into public goods—without breaking the promise made to workers who saved for a secure future.