Socio-Economic Rights and Accountability Project (SERAP) has urged President Muhammadu Buhari to instruct the National Pension Commission (NPC) to stop state governors from borrowing N17 trillion from pension funds.

The requested loan is said to be for “infrastructural development.”

The organisation said this in a letter dated December 5, 2020, and signed by SERAP deputy director Kolawole Oluwadare.

The organisation said, “Allowing the governors to borrow from pension funds would be detrimental to the interest of the beneficiaries of the funds, especially given the vulnerability of pension funds to corruption in Nigeria, and the transparency and accountability deficits in several states.”

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The letter copied the Attorney General of the Federation and Minister of Justice, Abubakar Malami.

SERAP noted that it would be very difficult to hold governors to account for the spending of pension funds, as states have persistently failed to account for the spending of public funds including security votes.

SERAP expressed “serious concerns that the proposed borrowing by the 36 state governors from the pension funds would lead to serious losses of retirement savings of millions of Nigerians.”

Part of the letter read, “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.”

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“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.”

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