FG Bows to Labour Pressure, Reverses NSITF Deductions, Moves to Appoint PenCom Chairman

The Nigerian government has taken significant steps to address two major demands presented by the Nigeria Labour Congress (NLC), following a strike ultimatum issued by the union. Among the resolved issues are the reversal of a controversial 40 percent deduction from the Nigeria Social Insurance Trust Fund (NSITF) and the reported appointment of Opeyemi Agbaje as Chairman of the National Pension Commission (PenCom), though the latter is yet to be officially confirmed.

This development comes after the NLC, in a statement by its President, Joe Ajaero, gave President Bola Ahmed Tinubu a seven-day notice to take action or face a nationwide economic shutdown. The union demanded the halting of deductions from NSITF and the proper constitution of the PenCom board.

In a letter addressed to the NLC on August 16, 2025, NSITF Managing Director Oluwaseun Faleye confirmed that no further deductions would be made from workers’ contributions or investment returns. He explained that a 2023 Federal Ministry of Finance circular had mandated 50% automatic deductions from revenues of federal agencies, but that directive was revised following a March 2024 order from the Accountant-General. Faleye added that efforts are underway to reverse some of the earlier deducted funds.

The NSITF also reported that both the Minister of Finance and the Director-General of the Budget Office had assured, in August 2025 meetings, that the deductions would cease completely. Reacting to the letter, NLC Secretary Christopher Onyeka acknowledged its receipt and said the union’s executive council would assess it before taking a final decision on the planned strike. He emphasized the importance of safeguarding workers’ compensation funds, stating, “These are not government revenues. They exist to protect injured workers, and we must defend them.”