FG Establishes Dedicated CBN Account for Civil Service Exit Benefits

The Federal Government has created a dedicated account with the Central Bank of Nigeria (CBN) to manage and distribute funds for the newly introduced Exit Benefit Scheme for retiring civil servants. The move is designed to ring-fence the allocations, ensuring transparency and eliminating payment delays that have historically affected public sector retirement benefits.

According to the official implementation guidelines signed by the Head of the Civil Service of the Federation, Didi Walson-Jack, the special account will be managed exclusively by the National Pension Commission (PenCom). The account will serve as the sole repository for all funds allocated to the welfare scheme, allowing relevant agencies to track financial inflows and outflows transparently.

The Exit Benefit Scheme, which was approved by the Federal Executive Council, applies to employees of treasury-funded Ministries, Departments, and Agencies (MDAs) who have completed a minimum of 10 years of service. Upon retirement or disengagement, eligible workers will receive a lump-sum payment equivalent to 100% of their total annual emoluments.

The policy officially took effect retroactively on January 1, 2026. Officials clarified that the new benefit is entirely non-contributory and fully funded by the government through annual budgetary provisions and special allocations. It operates alongside the existing Contributory Pension Scheme rather than replacing it.

## The Disbursement Workflow

To ensure administrative efficiency, multiple government financial bodies will cooperate through a structured pipeline to move funds from the national budget to individual retirees:

1. Data Collation and Verification

PenCom

PenCom gathers employee retirement data from the Integrated Payroll and Personnel Information System (IPPIS) and the Government Integrated Financial Information System (GIFMIS) to build a verified database of upcoming retirees and calculate financial obligations.

2. Budgetary Appropriation

Budget Office of the Federation

The Budget Office uses PenCom’s financial estimates to create the necessary annual fund allocations within the national budget.

3. Quarterly Funding Plans

Federal Ministry of Finance

The Ministry of Finance prepares quarterly cash release plans based on the approved budget to guarantee the continuous availability of liquidity.

4. Fund Transfer to CBN

Office of the Accountant-General

The Office of the Accountant-General of the Federation moves the approved cash into the dedicated Exit Benefit Scheme Account at the CBN.

5. Final Distribution to Beneficiaries

PFAs (10-Day Limit)

PenCom transfers the cash to individual Pension Fund Administrators (PFAs), which are legally required to disburse the final payments to retirees’ personal accounts within 10 working days.

The guidelines also include transitional provisions to accommodate civil servants who retired between January 1 and September 30, 2026, as well as the next-of-kin of eligible employees who passed away during that period. All prospective beneficiaries have been directed to process their claims directly through their respective PFAs.