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TopIntroduction And Statement Of Problem
Retirement is the time when an individual stops a particular job having satisfied the requirements associated with retiring from that job. The requirements usually include the attainment of a specified age as stipulated by law. In Nigeria for instance, under the old Pension Act, the retirement age was stipulated at 60 years or 35 years of service whichever came first (Law of Federation of Nigeria, 2004). This period is an epoch making event in the life of the officer and the organisation concerned considering the long years of relationship between the retiring officer and the organisation.
However, in recent times, this may no longer be so for employees planning to retire from active service. This might not be unconnected with the stress associated with retirement process. Issues like delay in payment of gratuities (a lump sum amount of money paid to the worker at the point of retirement before the commencement of pension payment and is usually based on certain criteria such as length of service among others) pension are some of the challenges faced by the retirees. Studies have showed that globally, current pension system do not deliver the expected coverage and benefit levels; aside this, an unsustainable pension system leads to the crowding of other social expenditures (Barbone & Sanchez, 1999; Holzsmann & Hinz, 2005; Heller, 2006; Akwimbi, 2006; World Bank, 2006; Juurikkala & Booth, 2008). In Nigeria for instance, retiring officers face several challenges in getting their gratuities and pension and this usually subject millions of retirees into poverty and neglect (Osakwe, 2004; Orifowomo, 2006; Iwajuwa, 2005). Such hardships include irregular payment of pensions and gratuities, standing on long and endless queues while waiting to collect pensions; poor and inefficient services on the part of the administrators. It was reported that some pensioners have died in the process of getting their benefits and pensions (This Day, 2007). Recently in Lagos, Nigeria, about ten thousand pensioners threatened mass suicide in order to drive home their demands due to the unpleasant experiences they had while trying to collect their pensions and gratuities (Iwajuwa, 2005). All these challenges are as a result of inefficient administration in the country. Studies have also showed the link between successful pension administration and governance (Booth, Juurikkala, & Silver, 2008; Mercer, 2006; Ambachtsheer, 2006; Clark & Urwin, 2007; Clapman, 2007).
During president Obasanjo administration (1999–2007), the federal government admitted that it owed the pensioners as much as 3 trillion naira which has not been paid till date (Nigeria Tribune). Further, the monthly pension bill of Nigeria Railways (a parastatal in Nigeria) was estimated at N250 million (Osakwe, 2004). In addition, as at December 2005, the Director General of the newly established National Pension Commission, puts the pension debt of the federal government at N2.56 trillion naira, with a break down as follows: Retired federal ministry and parastatals; 2 trillion, and accumulated pension for military police and paramilitary at N56 billion (The Daily Champion, 2005). Retirement process with its attendant problems among retirees therefore becomes a serious concern.