- The Organised Private Sector of Nigeria (OPSN) has formally rejected the National Pension Commission’s (PenCom) proposal to increase mandatory pension contribution rates and impose an additional 3 percent statutory payroll levy.
- Business leaders warned that raising pension contribution requirements beyond the current 18 percent mark could prove counterproductive, threatening employment opportunities, wage growth, and MSME viability amidst tough economic headwinds.
- OPSN urge the Federal Government to prioritize stabilizing the economy, taming inflation, and preserving enterprise survival before introducing new statutory financial burdens on employers.
The Organised Private Sector of Nigeria (OPSN) has expressed strong opposition to a proposed increase in mandatory pension contributions put forward by the National Pension Commission (PenCom), describing the initiative as premature, counterproductive, and a threat to corporate survival.
Eko Hot Blog reports that in a joint statement issued by key industrial leadership groups, including the Manufacturers Association of Nigeria (MAN), the National Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), the Nigeria Employers’ Consultative Association (NECA), the Nigerian Association of Small and Medium Enterprises (NASME), and the Nigerian Association of Small Scale Industrialists (NASSI), employers warned that the proposed policy could act as a “Greek gift” to the Nigerian workforce.
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The opposition follows PenCom’s announcement regarding plans to review the Pension Reform Act 2014, which includes increasing the mandatory contribution rate beyond the current 18 percent threshold (comprising a 10 percent employer contribution and an 8 percent employee contribution) and introducing an additional mandatory 3 percent annual contribution based on total wage bills.
Speaking on behalf of the coalition, NECA Director-General Mr. Adewale-Smatt Oyerinde emphasized that announcing rate increases while stakeholder consultations remain ongoing undermines transparent social dialogue.
He noted that Nigeria’s current minimum contribution rate of 18 percent already aligns closely with the global OECD average of 18.8 percent, making an immediate upward review unjustified without localized actuarial evidence.
Elaborating on the broader macroeconomic pressure, MAN Director-General Mr. Segun Ajayi-Kadir highlighted that Nigerian businesses are already grappling with severe operational bottlenecks, including elevated energy costs, high interest rates, foreign exchange volatility, and weak consumer demand.
He cautioned that imposing additional statutory payroll burdens could force enterprises to freeze recruitment, delay wage increases, downsize workforces, or pass expenses onto consumers through higher commodity prices.
Similarly, NASSI Director-General Ifeanyi Oputa noted that micro, small, and medium-sized enterprises (MSMEs) would bear the brunt of the policy due to narrow profit margins.
Oputa warned that additional financial levies could drive formal businesses into non-compliance or force them into the informal economy, ultimately shrinking the total pool of formal pension contributors.
The coalition called on the Federal Government and PenCom to suspend any statutory pension increases until broader macroeconomic stability is achieved, urging authorities to focus instead on curbing inflation, protecting workers’ immediate cash flow, and supporting enterprise sustainability.
