Contributory Pension Risks and Sustainability for Nigerian Economic Reliability
DOI:
https://doi.org/10.23918/ejmss.v7i1p13Keywords:
Contributory Pension Risks, National Pension Commission, Nigerian Economy, Pension Reform Act 2014, ReliabilityAbstract
The Pension scheme especially contributory pension funds have significantly added the sustainable growth in Nigerian economy. The objective of this research is to investigate empirically the contributory pension risks and sustainability for Nigerian economic reliability for eighteen years (2004-2021). Ex-post facto and multiple regression statistical tools are adapted as the research design and instruments of statistical measurement respectively through the secondary data from National pension commission annual report and CBN statistical bulletin respectively. The analysed results reveal that namely public fund assets, private fund assets and exchange rate are strongly correlated and significant with the real gross domestic products as well as with other variables except inflation rate where there is weakly correlated and non-significant. Only inflation rate has a directly and non-significantly weak correlation with the real gross domestic products as well as other variables. Also, the representative results reveal public fund assets, Private fund assets, and exchange rate show directly and statistically significant associative effect by the explained parameter of (B, Sig.) as (81.90, 0.001), (117.52, 0.000) and (237.66, 0.000) respectively. Only the inflationary trending rate shows indirectly and statistically non-significant effect on Nigerian economic sustainability and reliability by the explained parameter of (B, Sig.) as (-524.42, 0.352) respectively. The recommendations suggest that the Nigerian quoted pension fund administrators and custodians should prudently manage and invest the pension fund assets in accordance with the contributory pension fund scheme as well as other regulatory bodies’ directive in such a way to leverage the internal and external guidelines.
Downloads
References
Abdullah, U. A., Obadare, G. O., & Anifowose, O. L. (2022). Contributory pension scheme on Nigeria economic growth. KIU Interdisciplinary Journal of Humanities and Social Sciences, 3(1), 264-283. https://kijhus.kiu.ac.ug/assets/articles/1652266699_contributory-pension-scheme-on-nigeria-economic-growth.pdf
Akinwale, O. S., & Abiola, O. R. (2008). A conceptual model of asset portfolio decision making: A case study in a developing economy. Global Journal of Business and Management, 2(5), 001-009. https://www.globalscienceresearchjournals.org/articles/a-conceptual-model-of-asset-portfolio-decision-making-a-case-study-in-a-developing-economy.pdf
Andersen, J. V. (2008). Models of investment decision making in finance. In Encyclopedia of Complexity and Systems Science. Retrieved from: http://arXiv.org/abs.
Ayuba, P. D., Adeleke, I. A., & Nafiu, N. A. (2023). Examination of contributory pension asset in Nigeria’s Private and public sectors. Nigerian Journal of Management Sciences, 24(2a), 160-168. https://nigerianjournalofmanagementsciences.com/wp-content/uploads/2023/08/17.-EXAMINATION-OF-CONTRIBUTORY-PENSION-ASSET-IN-NIGERIAS-PRIVATE-AND-PUBLIC-SECTORS.pdf
Dahir-Umar, A. (2022). 2021 annual report. National Pension Commission (PenCom), 1-139. 2021-ANNUAL-REPORT-DRAFT-12-1-LPFOs-Final-PENCOM.pdf
Edogbanya, A. (2013). An assessment of the impact of contributory pension scheme to Nigerian economic development, Global Journal of Management and Business Research; 13(2), 47-60. https://globaljournals.org/GJMBR_Volume13/6-An-Assessment-of-the-Impact.pdf
Etim, R., Asuquo, M., & Udo, N. (2023). Contributory pension scheme and human development index in Nigeria. Global Journal of Accounting and Economy Research, 4(1), 67-85. https://doi.org/10.47509/GJAEF.2023.v04i01.05 https://www.arfjournals.com/image/catalog/Journals%20Papers/GJAER/2023/No%201%20(2023)/5_Raphael%20S.pdf
Federal Government of Nigeria. (2014). Pension Reform Act, 2014. Lagos: Official gazette FON. https://admin.theiguides.org/Media/Documents/PENSION%20REFORM%20ACT%202014%20-%20GAZETTED%20COPY.pdf
Fiiwe, J. L. (2020). Analysis of retirement benefits in Nigeria: A case study of selected federal establishment. Equatorial Journal of Marketing and Insurance Policy, 4(1), 1-15. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3571473
French, N, &. Gabrielli, L. (2005). Judgements, forecasts and decisions: An analysis of fund managers over time. Paper Presented at Ares 21st Annual Meeting, Santafe. https://centaur.reading.ac.uk/20891/1/1505.pdf
Haruna, M., Makama, L. L., & Daniel, D. (2021). Effects of contributory pension scheme on economic development of Nigeria. International Journal of Innovative Research and Creative Technology, 2(2), 26-33. ISSN: 2354-5988. https://www.ijirct.org/papers/IJIRCT1601005.pdf
Independent Evaluation Group. (2006). Pension reform and the development of pension systems: An evaluation of world bank assistance. International Bank for Reconstruction and Development/ The World Bank. https://hdl.handle.net/10986/6956. License: CC BY 3.0 IGO. https://doi.org/10.1596/978-0-8213-6551-9
Iyortsuun, A. S. & Akpusugh, K. T. (2013). Effective management of life after retirement and its impact on retirees from the public service: A case study of Benue state, Nigeria. Global Journal of Management and Business Research; 13(5), 1-7. file:///C:/Users/USER/Downloads/1-Effective-Management-of-Life_pdf.pdf
Kune, J. B. (2011). Pensions in a shrinking economy. Pension: An International Journal, 16(1), 21-32.
Madukwe, O. D., Ayanwaokoro, M., & Okere, D. (2023). Effect of contributory pension fund investment in federal government security on Nigerian economy. International Journal of Research Publication and Reviews, 4(1), 786-794. https://www.semanticscholar.org/paper/Effect-of-Inflation-on-Pension-Fund-Investment-in-Darlington-Madukwe/34e85792bb2cbb71db0cdf508b691909057bca42
Madukwe, O. D., & Okere, D. C. (2022). Effect of inflation on pension fund investment in federal government securities in Nigeria. World Journal of Advanced Research and Reviews, 14(3), 074-085. ISSN: 2581-9615. https://doi.org/10.30574/wjarr.2022.14.3.0471 https://wjarr.com/sites/default/files/fulltext_pdf/WJARR-2022-0471.pdf
Mgbada, F. N., Nwite, S. C., Ele, L. E., Uguru, L. C., & Tebepah, S. F. (2023). Effects of Nigerian pension scheme on economic growth of Nigeria. African Banking and Finance Review Journal (ABFRJ). International Open Access Journal, 6(6), 214-231. https://www.abfrjournal.com/index.php/abfr/article/view/108
Muraina, S. A. (2023). Effect of financial performance of pension fund administrators (PFAS) on economic growth in Nigeria. Global Journal of Accounting and Economy Research, 4(2), 87-112. ISSN: 2319-443X. https://www.abfrjournal.com/gjaer/issue/269
Nafiu, N. A., Adisa, T. A., Olaifa, F. I., & Akintayo, A. A. (2025). Growth efficiency of contributory pension scheme and economic performance: Evidence from Nigerian insurance industry. ISRG Journal of Economics, Business & Management (ISRGJEBM), 3(4), 183-189. https://doi.org/10.5281/zenodo.16908194
National Pension Commission (2022). Annual report. Pension Commission. www.pencom.gov.ng
Nweke, J. O. (2014). Assessment of the administrative challenges associated with non-contributory pension scheme in Ebonyi State. Nigeria. International Journal of Development and Management Review, 9(1), 255-265. https://ajosdemar.com/wp-content/uploads/2024/04/Vol.-9-No.-1-201420.pdf
Odia, J. O. & Okoye, A. E. (2012). Pension reform in Nigeria: a comparison between the old and new scheme. Afro Asian Journal of Social sciences, 3, 1-17.
Ogonda, G. O., & Okiakpe, E. K. (2022). Pension fund investment and economic development in Nigeria. Nigerian Journal of Management Sciences, 23(2), 172-180. https://nigerianjournalofmanagementsciences.com/wp-content/uploads/2022/09/16.-PENSION-FUND-INVESTMENT-AND-ECONOMIC-DEVELOPMENT-IN-NIGERIA.pdf
Oloja, D. O. (2019). The pension reform act 2004 and retirement planning in Nigeria, Journal of Economics and International Finance, 3(2), 109-115. https://journal-backups.lon1.digitaloceanspaces.com/uploads/main/article/article1379670903_Nyong%20and%20Duze.pdf
Olulu-Briggs, O. V. (2023). Pension assets investment in the Nigeria economy. Saudi Journal of Economics and Finance, 7(3), 115-125. https://doi.org/10.36348/sjef.2023.v07i03.001
Pike, R., & Neale, B. (2012). Corporate finance: Decisions and strategies. England: Pearson Education Limited.
Tsado, E. and Gunu, U. (2011): Analysis of investment decision by Nigerian pension fund administrators (PFAs). International Business and Management, 3(2), 133-140. https://journal-backups.lon1.digitaloceanspaces.com/uploads/main/article/article1379670903_Nyong%20and%20Duze.pdf
Umar, G., & Emmanuel, T. (2012). Contributory pension system as a tool for economic growth in Nigeria. International Journal of Business and Behavioural Sciences, 2, 6-8. https://www.scirp.org/reference/referencespapers?referenceid=2577484
Wilcox, D. W. (2006). Reforming the defined-benefit pension system. Brookings Papers on Economic Activity 2006
Downloads
Published
Issue
Section
License
Copyright (c) 2026 Najimu Ayinde Nafiu, Emmanuel Bamidele Bakarey
Eurasian Journal of Management & Social Sciences (EJMSS)
Creative Commons Attribution Non-Commercial 2.0 Generic Licence (CC BY-NC 2.0)
How to Cite
