Some civil servants welcomed the reintroduction of gratuity in the federal civil service, describing it as a major relief that will ease financial burdens after retirement.
The workers, who spoke in separate interviews in Abuja, said the move marked a return to the “good old days’’ of enhanced retirement benefits for civil servants.
The Federal Executive Council, on March 5, approved a new exit benefit scheme that introduces a gratuity payment for retiring officers.
Under the new scheme, retiring federal civil servants in treasury-funded ministries, departments, and agencies will receive a gratuity equivalent to 100 per cent of their total annual emoluments, that is, one full year’s salary package.
The benefit applies to officers who have served for a minimum of 10 years and complements the existing Contributory Pension Scheme, which was introduced 22 years ago and previously operated without a gratuity component for many retirees.
Safia Umaru said she was excited when she heard the news from a colleague.
Another civil servant, Wale Ogunnaike, a deputy director retiring in July, put the benefits of the reintroduced gratuity in perspective to justify the big relief it will bring to retirees.
Mr Ogunnaike said, “I am billed to retire in three months’ time, and the total savings in my contributory pension scheme are about N20 million. With the unfavourable and exploitative provisions in the Contributory Pension Scheme Act, I am only entitled to 25 per cent of the contribution, about N5 million, to be paid to me in a lump sum.
“The balance of 75 per cent, about N15 million, will be paid to me on a monthly basis for 10 years, 120 months, at approximately N125,000 per month. My worry has been that, with Nigeria’s economic situation, what business will I start with N5 million, after putting in 35 years in service?”
Mr Ogunnaike said the reintroduction of gratuity has brought great succour, because what he will receive will complement his pension’s lump-sum payment for tangible investment.
According to him, with his current monthly gross earnings of about N500,000, the anticipated gratuity will be about N6 million.
“With N5 million pension lump sum and N6 million gratuity payments, I can make reasonable and wise investment decisions that are befitting for a retired civil servant of my status,” he said.
Mr Ogunnaike, however, appealed for prompt and unhindered implementation of the gratuity, so that the joy of civil servants will not be cut short.
Alice Ita said, “It will reduce the constant worry about what to do after retirement and the challenges of accessing a pension. It is indeed a big relief.”
Ms Ita urged the National Assembly to review the pension act, to allow retirees access to at least 50 per cent of their total savings without encumbrance.
Specifically, she called for the removal of the inhibiting clause in the act, which provides that the lump sum can only be taken if the remaining balance can still provide at least 50 per cent of the retiree’s final salary as a monthly pension.
Obinna Ibe described the return of gratuity as welcome, noting that civil servants face numerous economic challenges.
He also called for improved welfare for civil servants, including salary reviews to reduce disparities across government agencies.
Michael Samson described gratuity as a ‘plan B’ for civil servants after retirement. According to him, the lump-sum payment can help retirees stabilise their lives and even start small businesses.
(NAN)