The pension fund's value in dollars went down to $14.39 billion in January 2024, which is 29 percent less than the $20.41 billion in December 2023.
The January unaudited report on the pension funds industry portfolio states that the value of the pension fund was changed to N1,356.88/$ in January from N899.39/$ in December, causing the decrease.
Since the Central Bank of Nigeria changed the country's exchange rate in June 2023, the naira has been struggling against the dollar.
The naira losing further value this year has decreased the pension funds' worth in dollars.
In naira terms, the total assets under the Contributory Pension Scheme increased to N19.53 trillion from N18.36 trillion at the end of 2023, according to data from the National Pension Commission.
The report reveals that N12.14 trillion of the assets' value was invested in Federal Government securities, higher than the previous month's N11.92 trillion.
Aisha Dahir-Umar, the Director General of the National Pension Commission, recently refuted claims that the commission loaned N10 trillion to the Federal Government.
Dahir-Umar clarified that PenCom was not a bank and did not manage pension funds, adding that the Federal Government did not receive a N10 trillion loan from the commission.
She commented, “Investments by the PFAs in the securities of the Federal Government of Nigeria are not loans as mistakenly portrayed, but investments in securities, through bonds and treasury bills, as approved by the relevant government agencies, in this case, the Debt Management Office and Securities and Exchange Commission. They are traded on authorised capital markets. That is, the Nigerian Exchange Limited and FMDQ OTC Securities Exchange.”
The PenCom data revealed that the Retired Savings Account membership as of January 2024 reached 10,223,672, showing a 0.32 percent increase from December’s 10,191,400.
In a previous conversation with The PUNCH, the Head of the Corporate Communications Department, PenCom, Abdulqadir Dahiru, stated that the depreciation of local currency not only affected pension funds but also had a broader impact on the economy.
Regarding how the commission was addressing the microeconomic challenges, he said, “Naira devaluation did not just impact pension funds; it had an effect on everyone, and it is a dual issue. You have inflation and you have devaluation.
“So, anyone with money in the bank can testify to the impact of inflation on their money. It reduces the currency's value because then you need more of that currency to purchase the same amount of goods and services.”
According to Dahiru, pension funds have an advantage as they are invested in various instruments.
According to the National Bureau of Statistics, Nigeria’s inflation rate for February was 31.70 percent.
