ANALYSIS OF THE LEGAL REGIME FOR CONTRIBUTORY PENSION SCHEME IN NIGERIA

CHAPTER ONE GENERAL INTRODUCTION

1.1 Background to the Study

Pension is benefit paid to an employee on retirement. It represents a reward for long duration of service and loyalty to an employer and it could be perceived as a deferred remuneration package. ¹ The idea is to make employees financially independent during post-employment period. It is based on these realities that social security pension was conceived, particularly to essentially serve as tools for ensuring income security for women and men as they grow older.² This income is necessary for the dignity and wellbeing of older persons, and imperative to realize their rights.  The goal is to provide adequate, affordable, sustainable, and robust benefits after retirement. ³ By adequate it means, pensions should be able to replace sufficient lifetime earnings of retirement income in order to prevent old age poverty. The world is ageing very fast as the number of people aged 60 and over worldwide has been increasing at an unprecedented rate.⁴ The older population is growing faster than the total population in almost all the regions of the world⁵. In particular, the population of Africa is growing older faster, at a rate of 2.27 percent⁶. The percentage of those aged 60 years and over is projected to increase from 6 percent in 2012 to 10 percent in 2025⁷. Similarly, in West Africa, it is projected to increase from 5 percent in 2012 to percent in 2025 and in Nigeria, from 5.3 percent in 2012 to 7.4 percent in 2025⁸.