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VOL. 7, ISSUE 4 (2025)

Pension coverage, adequacy, and inclusion in Nigeria: An empirical assessment of PTAD and PENCOM

Authors

Obasi Michael Ihembuchi, Ibrahim Musa, Kabiru Muhammed

Abstract

Pension systems play a critical role in safeguarding the welfare of retirees and promoting socioeconomic stability, yet concerns persist regarding pension coverage, adequacy, transparency, and service delivery in Nigeria. This study investigates staff perceptions within the Pension Transitional Arrangement Directorate (PTAD) and the National Pension Commission (PENCOM) to assess the effectiveness of pension administration under the Defined Benefit Scheme (DBS). Using a descriptive cross-sectional design, data were collected from 239 respondents using a structured, validated questionnaire. Descriptive statistics, reliability analysis, and Spearman's Rank Correlation were used to evaluate pension coverage and inclusion, benefit adequacy and inflation protection, governance and transparency, service delivery efficiency, and pension fund investment sustainability. Findings reveal generally positive perceptions across most indicators, particularly in governance structures, service delivery improvements, and investment oversight. Respondents reported that PTAD maintains clear administrative procedures, strong internal controls, and effective communication with pensioners. However, areas requiring improvement include the inclusion of informal-sector workers, the adequacy of inflation-adjusted benefits, and enhanced sensitisation efforts for underserved groups such as women and rural residents. Correlation analysis indicates weak, mainly statistically insignificant relationships among the major pension system components, suggesting that improvements in one dimension — such as service delivery — do not automatically translate into advancements in coverage, adequacy, or investment sustainability. A weak but significant negative correlation was observed between service delivery and investment sustainability, reflecting nuanced staff perceptions on resource prioritisation. The study highlights substantial progress in pension administration within Nigeria's DBS framework, while emphasising the need for broader coverage expansion, stronger inflation protection mechanisms, and targeted reforms to enhance equity and long-term sustainability. The findings provide evidence-based insights valuable for policymakers, pension administrators, and stakeholders seeking to strengthen Nigeria's pension architecture.

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Pages:78-86

How to cite this article:

Obasi Michael Ihembuchi, Ibrahim Musa, Kabiru Muhammed "Pension coverage, adequacy, and inclusion in Nigeria: An empirical assessment of PTAD and PENCOM". International Journal of Commerce and Economics, Vol 7, Issue 4, 2025, Pages 78-86

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