LCCI Urges Suspension of Proposed Pension Contribution Increase

The Lagos Chamber of Commerce and Industry (LCCI) has called on the federal government and the National Pension Commission (PenCom) to suspend a proposed three-percentage-point increase in mandatory pension contributions. The LCCI argues that this increase would raise employment costs at a time when businesses are already facing high financing costs, persistent inflation, exchange rate pressures, rising energy prices, and multiple taxes.

Dr. Chinyere Almona, the LCCI Director General, noted that Nigeria's current mandatory pension contribution of 18% (10% from employers and 8% from employees) is in line with the OECD average of 18.8%. An increase to approximately 21% would surpass contributions in comparator economies such as the United Kingdom (8%), the United States (12.4%), Kenya (12% subject to earnings caps), and South Africa (which has no equivalent mandatory private-sector pension contribution).

The LCCI expressed concerns that the proposed increase would discourage recruitment, hinder wage growth, disproportionately affect micro, small, and medium enterprises (MSMEs), reduce Nigeria's competitiveness for investment, and increase the risk of non-compliance and business informality.