The Nigerian government has announced plans to finance 5,000 kilometres of roads using pension funds through institutional investments.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, disclosed the initiative during an online chat with journalists.
He described the plan as part of broader efforts to stimulate economic growth through private-sector participation in infrastructure projects.
Stakeholders Express Fears Over Transparency and Financial Accountability
Critics have raised concerns about the transparency of using pension savings for infrastructure projects with unclear oversight mechanisms. Nigeria has a track record of financial mismanagement, contract inflation, and abandoned projects that heighten scrutiny of the initiative.
Minister Edun has not provided details on specific highways earmarked for construction under this financing arrangement. Without a clear project list, tracking expenditures and assessing progress will be challenging.
Potential Risks to Pensioners’ Financial Security Spark Warnings
Nigeria’s pension fund, currently valued at over ₦17 trillion, is a critical safety net for millions of retirees nationwide.
The National Pension Commission (PenCom) has previously warned against using pension savings for high-risk infrastructure investments. Experts caution that retirees’ benefits could be jeopardised without stringent safeguards if projects underperform or funds are misallocated. Government officials insist that private-sector involvement will mitigate financial risks for pension contributors.
Economic Recovery, Growth Plans, and Private-Sector Investments
Minister Edun noted that Nigeria’s economy showed resilience, recording 3.84% GDP growth in Q4 2024 despite fiscal challenges.
He reported a 20% increase in government revenue, alongside a reduced budget deficit and declining debt servicing costs.
The administration plans to launch a ₦1 trillion low-interest mortgage fund to stimulate the housing sector. Additional economic strategies include expanding domestic refining capacity and encouraging private investments in infrastructure.
Calls for Stronger Oversight and Accountability in Pension Fund Utilisation
Transparency advocates demand comprehensive details on project selection, execution frameworks, and accountability measures before pension funds are deployed. Given Nigeria’s history of financial mismanagement, stakeholders insist on stronger oversight to prevent misallocation or misuse of retiree savings.
As inflationary pressures persist and economic challenges remain, the initiative requires greater scrutiny to protect pensioners’ financial security.
