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No rest in retirement
– by Damilola Oyedele
© Joe Penny/Reuters
Self-employed people in the informal sector normally cannot save much money for hard times: street vendor in Kano.
Sarah Alade lives in Ibadan, Nigeria, with her daughter and son-in-law. A native of Ogbomosho, Oyo State, she lost her husband about 30 years ago; but as businesswoman, she was able to pay for the education of their only daughter.
Her business, however, began to experience a downward slide due to serious arthritic pains which affected her ability to run it. Now at 82 years, Sarah realises that she is still luckier than most of her peers, since her family takes care of her: “My daughter and son-in-law are not rich people, but they still provide for me,” she says. 74-year-old Anthony Egwuatu is, however, not that lucky; he has no child to take him in. A retired soldier, he served on some foreign peace-keeping missions. But the delay in pension payments has resulted in abject poverty for him. Anthony used part of his gratuity from the army to build a makeshift house in his village, but he has to rely on the goodwill of neighbours or the occasional pension payment for daily sustenance and health care.
High cost of living
Most Nigerians who are old now did not prepare for old age. In their youth, farming and trading were the dominant occupations; there was no structure for pension plans. Those who were well off in their heyday were able to provide good education for their children. In most cases, these people are now better off in their old age, even without a pension plan, because their children are in the financial positions to care for them. But the majority, who were just peasant farmers or small time traders, were forced to spend all their income on their sustenance, without being able to save anything for old age.
In most parts of Africa, the cultural customs and social system expect children to care of their parents in their old age, to provide food and health care and even take them in. Most Nigerians believe that children receive blessing from God when they make efforts to care for their aged parents and make them happy. But the reality is that, in most cases, the now grown-up children are struggling to keep financially afloat; caring for the parents is a huge challenge.
Abdul Hassan, a civil servant residing in Abuja, shows how hard it is for children to be the sole financiers for their parents: “I send 10,000 naira (the equivalent of about $ 70) to my parents every month. Luckily, they live in the family house in the village; so there is no need to pay for accommodation. But I also pay their house-help 2,000 naira monthly,” he explains. “I wish I could do more, but I live in Abuja with the crazy rents. I have a wife and two children to provide for, all out of my meagre monthly salary of 140,000 naira.”
In Nigeria, the retirement age is 65 years – or after 35 years in service, but this applies only to the public sector. Old people who worked for private multinationals and banks have always enjoyed pensions, unlike their peers who worked for the government. But many who used to work for other private organisations were not covered by any pension schemes.
Though the government does have a pension scheme for retired civil servants, the beneficiaries almost never get their money because of corruption. Most are even lucky to access their gratuities. There are reports of pensioners collapsing from fatigue brought on them from years of neglect while queuing up to collect their pensions. Led by the Nigeria Union of Pensioners (NUP), pensioners regularly gather in groups to protest non-payment or delay in release of their benefits.
The reason for this is that the Nigerian Civil Service formerly operated a pension scheme that was grossly under-funded. It was one of the most vulnerable items in the annual budget. Even when budgetary allocations were made, there was delay in the release of the funds which caused accumulation in arrears of pension benefits.
In 2004, the democratic government under president Olusegun Obasanjo decided to revamp the pension system. The 2004 Pension Reform Act had the aim to ensure that every person who works in the public or private sector receive his or her benefits in a timely manner.
According to the Act, the pension reform was set up for several objectives, for instance, “to assist individuals by ensuring that they save to cater for their livelihood during old age and thereby reducing old age poverty, to ensure that pensioners are not subjected to untold suffering due to inefficient and cumbersome processes of pension payment; to stem the growth of outstanding pension liabilities.” The act was also to establish a uniform set of rules, regulations and standards for the administration and payments of retirement benefits to retired workers in all sectors.
The pension system has become more refined after that, with private pension operators handling the pension processes; all of them are registered under the National Pension Commission as the regulatory agency. The reform has brought some improvements, but those who worked in the informal sector remain at the mercy of their children or other good Samaritans.
Some state governments have now taken the initiative to provide some kind of social security to their aged people. States like Osun, Ogun, Ekiti and Ondo – all in Southwest Nigeria – pay the sum of 5,000 naira to those registered on the scheme, in addition to providing health insurance for them and free treatment for age-related ailments.
This system still experiences some hiccups, like the embezzlement of funds. Recently, the Nigerian media reported the embezzlement of police pension funds amounting to 46 billion naira ($ 307 million) by the Chairman of the Police Pension Board and some of the board members. The matter is still being prosecuted in court.
The Nigeria Union of Pensioners remains at the forefront of fighting for the pension rights of workers. The union claims that of the 1,709 billion naira owed the senior citizens, only 45 % is actually paid. The recently elected president of the NUP, Abel Afolayan, says the union will soon embark on a struggle to demand a minimum pension wage in line with the increment on the national minimum wage.
There are also private initiatives for the welfare of the senior citizens in Nigeria. The “Senior Citizens and Elders Forum Nigeria”, for instance, organises fitness events to teach senior citizens how to manage age-related joint ailments through exercises such as yoga. Even some old peoples’ homes have been established by Christian missions. This all shows that the perception of age is changing.
The Dave Omokaro Foundation (DOF) is a private trust which is occupied with the topic of ageing, headed by Emem Omokaro, a sociologist. Through intense lobbying, she recently managed to convince the National Universities Commission to adopt gerontology as a post-graduate specialist study in the curricula of some Nigerian universities. According to Omokaro, senior citizens face pension problems as well as psychological trauma caused by loneliness and a feeling of being unwanted: “Some of them have children who consider them to be burdens, especially when they enter the years where they become almost completely dependent,” she says.
Although some improvements have been made, Nigeria still has a long way to go to ensure that its senior citizens spend their old age with a sense of belonging and enough to live on.
Damilola Oyedele is a senior correspondent at THISDAY Newspaper in Abuja, Nigeria. [email protected]