Khartoum University Journal of
Management Studies

  • Abbreviation: Khartoum Univ. J. Manage. Stud.
  • Language: English
  • ISSN: 1585-8069
  • DOI: 10.5897/KUJMS
  • Start Year: 1994
  • Published Articles: 35

An actuarial appraisal for the transitional provisions of the Nigeria “Pension Reform ACT, 2004”

R. O. Ayorinde
  • R. O. Ayorinde
  • Department of Actuarial Sciences and Insurance. Faculty of Business Administration, University of Lagos, Nigeria.
  • Google Scholar

  •  Accepted: 02 January 2006
  •  Published: 30 June 2006


This paper focuses on the transitional provisions of the Pension Reform Act of 2004, as they affect the public servants. The Act came into effect in Nigeria on 25th June, 2004 and repealed the Decree 102 of 1979. The transitional provisions of the Act, were to take care of the members in those schemes under Decree 102, as they transit to the arrangements provided by the new Act. In the transitional provisions, promises were made to the effected members, as per their accrued benefits. Essentially this paper tries to make a financial sense of the promises to see their chance of being redeemed. To provide an objective basis for the assessment of the promises, some indices – future salary, inflation and interest/investments returns – were identified, using relevant pension theories. This paper asserts that for the promises to be fulfilled there is the need to estimate the indices accurately. The paper shows that because of the non-availability of inaccurate data base, it may not be possible to fulfill the promises made. The paper through other research findings also showed that the employees may resist the changes proposed in the new Act. It is therefore recommended. That while new employees are subjected to the new Act, members of the old schemes be allowed to continue in those schemes.