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No attempt to illegally use pension funds for infrastructure development – FG

"What was announced to the Federal Executive Council was that there was an ongoing initiative drawing in all the major stakeholders in the long-term saving industry, those that handle funds that are available over a long period, to see how, within the regulations and the laws, these funds could be used maximally to drive investment in key growth areas."

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Minister of Finance Wale Edun has refuted claims that the Federal Government planned to use the N20 trillion pension fund for infrastructure.

Edun noted in a statement on Thursday in Abuja that specific legal frameworks strictly regulate the pension industry, just like they do other sectors in the financial industry.

Consequently, he said that the federal government does not plan to surpass these legal boundaries, emphasizing that the government is committed to protecting workers’ pensions.

Edun clarified: “It has come to my notice that stories are making the rounds that the Federal Government plans to illegally access the hard-earned savings and pension contributions of workers. Nothing could be farther from the truth.

“The pension industry, like most financial industries, is highly regulated. There are rules. There are limitations about what pension money can be invested in and what it cannot be invested in.

“The Federal Government has no intention whatsoever to go beyond those limitations and go outside those bounds that are there to safeguard the pensions of workers.

“What was announced to the Federal Executive Council was that there was an ongoing initiative drawing in all the major stakeholders in the long-term saving industry, those that handle funds that are available over a long period, to see how, within the regulations and the laws, these funds could be used maximally to drive investment in key growth areas.”

Media reports quoting the minister as saying that the federal government was considering tapping into the pension funds to drive investment in growth areas, including infrastructure and housing, necessitated the clarification.

Edun had said the move to use the pension funds was part of the government’s efforts to bridge Nigeria’s estimated 20 million housing deficit and to provide massive housing and mortgage loans at 12 percent interest rates with 25-year repayment plans.

Persecondnews recalls that the Nigerian Labour Congress (NLC) President, Joe Ajaero, and the Trade Union Congress (TUC) Deputy President, Tommy Okon, in a joint statement on Thursday, urged the government not to risk the future of workers by borrowing the money to fund infrastructure development.

They stated: “Nigerian workers have entrusted their hard-earned savings for retirement security, not as a means for government projects.

“It is imperative to halt any further plans to tap into these funds, especially given the lack of transparency and accountability in past government borrowing practices.’’

The organized labour demanded assurances from the government that further federal government borrowing would not affect workers’ retirement funds, particularly since the statutes have not constituted the PENCOM Board as intended.

They further argued that the Pension Act does not support any plan to borrow the funds.

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