In a landmark financial intervention, the Pension Transitional Arrangement Directorate (PTAD) has injected N55.9 billion into the pension system to settle monthly payments and a significant chunk of longstanding arrears. This massive disbursement in December 2025 represents one of the largest single-month pension payouts in recent years, offering substantial relief to thousands of retirees and their families under the old Defined Benefits Scheme (DBS).
A Detailed Breakdown of the N55.9 Billion Disbursement
According to a statement from the Directorate's Head of Corporate Communications, Olugbenga Ajayi, the total payment comprised two key parts. A sum of N13.41 billion was allocated for the routine monthly pensions for December 2025. The bulk of the payment, however, was a whopping N42.5 billion dedicated to clearing accumulated arrears that had burdened pensioners for some time.
The settled arrears include liabilities from several pension increments and benefits:
- The N32,000 pension increase.
- The 10.66% and 12.95% pension enhancements.
- Outstanding gratuity payments.
- Unpaid death benefits to next-of-kin.
A sectoral analysis reveals that civil service retirees received the largest share. The Civil Service Pension Department was credited with N16.36 billion for over 71,000 pensioners, highlighting the scale of pre-reform pension obligations. Substantial payments were also processed for pensioners from defunct agencies, parastatals, tertiary institutions, and uniformed services.
Clearing the Books and Looking Ahead
PTAD announced a major achievement: arrears linked to the N32,000 increment have now been fully cleared across all pension departments, with only minor exceptions. The Directorate noted that just one month's arrears remain for some pensioners in the Parastatals Pension Department and the Tertiary Education and Health Department, promising these will be settled imminently.
Speaking on this development, PTAD's Executive Secretary, Tolulope Odunaiya, framed the payments as a reflection of President Bola Ahmed Tinubu's commitment to senior citizens, aligning with the administration's Renewed Hope Agenda. She emphasized priorities like social protection and institutional reform.
Odunaiya reaffirmed PTAD's commitment to wiping out all residual arrears and boosting transparency. This will be achieved through ongoing verification exercises, digital payment systems, and better pensioner data management—measures seen as critical to preventing a future build-up of debt.
The Broader Impact on Pension Reform
Policy analysts view this payout as a crucial step in stabilizing the Defined Benefits Scheme (DBS). The DBS, which is fully funded by the Federal Government and covers retirees from the era before the 2004 pension reform, has been plagued by funding gaps and delayed payments. This intervention is seen as vital to restoring credibility to this segment of the pension system.
While stakeholders acknowledge that funding DBS obligations remains a persistent fiscal challenge, especially with competing national demands, they stress that regular and predictable pension payments are non-negotiable. Such payments are essential not only for the welfare and dignity of retirees but also for rebuilding public trust in the government's ability to meet its social obligations.
The N55.9 billion disbursement by PTAD in December 2025 therefore stands as a significant financial milestone and a symbol of progress in Nigeria's ongoing journey to fix its pension architecture.
