In a letter dated December 5, 2020, and signed by its deputy director, Kolawole Oluwadare, SERAP stated that permitting the 36 state governors to borrow from pension funds could be detrimental to the beneficiaries of the funds.
The group mentioned that the proposed borrowing is unjust and opposite to the letter and spirit of the Pension Reform Act, including that the governors’ proposition “would lead to serious losses of retirement savings of millions of Nigerians.”
The letter reads partially, “This proposed borrowing faces the risks of corruption and mismanagement, and would ultimately deny pensioners the right to an adequate standard of living and trap more pensioners in poverty. Rather than devising ways to address pensioner poverty, governments at all levels would seem to be pushing to exacerbate it.”
“Allowing the governors to borrow money from the pension funds would amount to a fundamental breach of constitutional provisions, the Pension Reform Act, and Nigeria’s international obligations, as well as fiduciary duties imposed by these legal instruments on all public officers to prevent pension funds from unduly risky investments, and to ensure transparency and accountability in the management of pension funds.
“We would be grateful if your government would indicate the measures being taken to instruct the NPC to stop the 36 state governors from borrowing and withdrawing any money from the pension funds within 14 days of the receipt and/or publication of this letter.”
“If we have not heard from you by then as to the steps being taken in this direction, the Registered Trustees of SERAP shall take all appropriate legal actions to compel your government to implement these recommendations in the interest of millions of Nigerian pensioners.”
The 36 state governors had not too long ago resolved to borrow N17 trillion from the pension funds for ‘infrastructural development.’