CHAPTER ONE

INTRODUCTION

1.1             Background to the Study

Retirement from active service is an inevitable stage which one cannot resist as a worker. In other words, it should not be overlooked by a worker. There is need for every worker to make conscious efforts towards retirement preparation because the goal of every retiree is to ensure a comfortable retirement (Amune, Ardenojie and Obonyan, 2015). Every employee desires to live well during retirement without compromising on the standard of living in which they were used to while in active service. Bukoye (2010) avers that one of the biggest problems that confront a typical worker in his/her working life is his post retirement life.

A cursory observation of retirees in Nigeria indicates issues related to sudden loss of life, anxiety about a residential home, idleness and dwindling social status among others. This was as a result of the Pay-As-You-Go (PAYG) defined benefit which was the Nigerian pension system in government ministries. This pension system was determined by specific factors such as salary history and service duration and it was besetted by many problems. These problems ranges from administrative bottle neck in the payment of pension and gratuity, weak and inefficient administration, irregular payment of pension, poor funding as a result of inadequate budgetary allocation, corruption and embezzlement of pension and gratuities by pension administrators (Fapohunda, 2013). This necessitated the need to embark on reforms that will alleviate the plights of pensioners in Nigeria.