Ogun State Debuts “Additional Pension Benefit” to Bolster CPS

​In a strategic move to cushion the transition to the Contributory Pension Scheme (CPS), the Ogun State Government has unveiled an Additional Pension Benefit (APB). This initiative, sanctioned by Governor Dapo Abiodun, aims to bridge the financial gap between the old Defined Benefit Scheme (DBS) and the current CPS, specifically addressing concerns surrounding gratuity payments.

​The APB serves as a one-off payment disbursed upon retirement. It is calculated based on a graded percentage of a retiree’s Final Total Annual Emolument (TAE). Depending on the length of service, eligible retirees can expect to receive between 116% and 280% of their final annual salary. Crucially, this benefit is paid directly to the retiree at the point of exit, ensuring that their Retirement Savings Account (RSA) balance remains untouched to fund monthly pension withdrawals.

​Financial Commitment and Arrears

​The state government has backed this reform with significant financial outlays to clear historical liabilities:

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• ​₦26.35 billion spent to offset outstanding gratuity liabilities.
• ​₦5.89 billion remitted to cover arrears of CPS deductions and investment returns.
• ​₦500 million disbursed as death benefits into the RSAs of deceased personnel.
• ​₦3.19 billion in total monthly remittances recorded between July 2025 and January 2026.

​Beyond the Payout: Mortgages and Transparency

​The reform also opens doors for public servants to leverage their pension assets for housing. Under the new framework, contributors can access up to 25% of their RSA balance as equity for residential mortgages.

​To ensure a seamless transition, stakeholders have recommended enhanced engagement with Pension Fund Administrators (PFAs), the establishment of toll-free communication lines, and comprehensive pre-retirement training to demystify the CPS process.