By Victor Ahiuma-Young

The Federal Government has taken a major step to eliminate longstanding disparities in pension payments under the Defined Benefit Scheme (DBS), approving the harmonisation of benefits for eligible federal pensioners with effect from May 2026.

The development, announced by the Pension Transitional Arrangement Directorate, PTAD’s Executive Secretary, Tolulope Odunaiya, through a statement by the Directorate’s Head, Corporate Communications, Olugbenga Ajayi,

is expected to bring relief to thousands of retirees whose pensions were previously calculated using different salary structures based on their dates of retirement, often resulting in wide variations in benefits among pensioners of the same rank and years of service.

PTAD said the policy, approved by President Bola Tinubu in August 2025 and incorporated into the 2026 pension budget, aligns with the administration’s Renewed Hope Agenda and seeks to promote fairness, social justice and improved welfare for pensioners.

The harmonisation is widely regarded as one of the most significant reforms in the administration of the Defined Benefit Scheme in recent years, addressing concerns that pensioners who retired earlier received lower benefits than colleagues with similar career profiles who left service later under more favourable salary structures.

According to  Odunaiya, the implementation marks a major milestone in addressing structural imbalances within the administration of the Defined Benefit Scheme.

“This intervention represents a significant step toward ensuring a more equitable structure and restoring confidence in the administration of the Defined Benefit Pension Scheme,” she said.

Odunaiya noted that the measure demonstrates the Tinubu administration’s commitment to the welfare of pensioners and its resolve to identify and correct long-standing inequities affecting retirees under the scheme.

She added that the reform also recognises the contributions of retired public servants by ensuring that pension benefits more accurately reflect their years of service and career progression, regardless of when they exited the public service.

Under the previous arrangement, pension benefits were calculated based on the salary structure in place at the time individual workers retired from service. This meant that retirees who left service years earlier were often disadvantaged compared to those who retired later after salary reviews and adjustments had been implemented.

However, with the harmonisation policy, pensions will now be computed using the last salary structure applicable at the cut-off date for the Defined Benefit Scheme. The change is expected to significantly narrow disparities in pension payments and create a more uniform benefits framework.

PTAD explained that the new approach would ensure that pensioners of similar rank, grade level and years of service receive equitable benefits regardless of when they retired.

The directorate said beneficiaries include pure federal pensioners whose pension obligations are fully borne by the Federal Government, as well as eligible pensioners under the Parastatals Pension Department, PaPD, Defunct and Transferred Agencies Pension Department, DTAPD, and the Tertiary Education and Health Pension Department, TEHPD.

Also eligible are State and Federal Share Pensioners under the affected departments, including pensioners who began their careers in the Federal Public Service before transferring to state government ministries, departments and agencies.

PTAD noted that the reform specifically targets pensioners whose benefits were previously calculated using salary structures that predated the final approved salary framework applicable to the Defined Benefit Scheme.

The agency reaffirmed its commitment to working with relevant government institutions to improve the welfare and wellbeing of pensioners, describing the harmonisation as a critical step towards strengthening confidence in the pension system and honouring the contributions of retired public servants.

PTAD further assured pensioners that it would continue to collaborate with key government agencies to implement policies and programmes aimed at enhancing their living conditions, in line with the administration’s commitment to social justice and inclusive welfare.

Stakeholders believe the policy will not only improve retirees’ welfare amid rising living costs but also strengthen confidence in the pension administration system by addressing grievances that have persisted for years among affected pensioners.