Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has addressed recent concerns about the Federal Government’s intention to use pension funds for infrastructure projects. In a video message shared on the ministry’s social media, Edun reassured the public that the government does not plan to improperly access workers’ pension savings.
“It has come to my notice that stories are making the round that the Federal Government plans to illegally access the hard-earned savings and pension contributions of workers. Nothing could be farther from the truth,” Edun stated, emphasizing the strict regulatory framework governing the pension industry.
He explained that the government is exploring ways to effectively utilize long-term savings within existing regulations to invest in key growth areas like infrastructure and housing. “The Federal Government has no intention whatsoever to go beyond those limits and go outside those bounds which are there to safeguard the pensions of workers,” he asserted.
Edun highlighted that the recent discussion at the Federal Executive Council was purely informational, with no approval sought for any actions. The initiative aims to leverage long-term funds from the savings industry, including pensions, to boost economic growth without compromising the safety or returns of these investments. “No attempt whatsoever to increase the risk, no attempt whatsoever to lower the returns that would otherwise be earned,” he assured.
The minister also pointed out the government’s ability to provide guarantees to unlock funding, which can lead to economic growth, job creation, and poverty alleviation. He stressed that this initiative is part of an ongoing dialogue with the financial industry to find innovative solutions that balance safeguarding long-term savings with economic development.
The government’s plan has faced substantial criticism, with concerns about the potential risks to workers’ financial security in retirement. Atiku Abubakar, the 2023 presidential candidate of the Peoples Democratic Party, voiced apprehensions that using pension funds for infrastructure development could have severe repercussions for Nigerians.
Despite these criticisms, Edun reiterated the government’s commitment to ensuring the safety and effective use of pension funds. “In conversation, in consultation, collaboration and cooperation with the private sector… 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,” he explained.