Nigerian Brethren Revamp Church Employees’ Pension Plan

The Majalisa or annual conference of Ekklesiyar Yan’uwa a Nigeria (EYN–the Church of the Brethren in Nigeria) has voted to implement a new pension plan for its church workers. The plan, following guidelines established in part by a recently-passed Nigerian pension law, was developed with the help of Tom and Janet Crago, short-term mission workers with the Global Mission Partnerships of the Church of the Brethren General Board.

The new plan, which provides benefits for all current and future EYN employees, plus existing pensioners, was passed after “considerable debate about the costs involved,” according to reports from Nigeria. It replaces a pension plan in which most employees and congregational employers did not have to contribute directly to the cost of their future pension benefits. Such “pay-as-you-go” pension plans have been quite common in Nigeria in the past.

The Cragos explained the previous system a bit more. “Each church pays 15 percent of its offerings annually to EYN headquarters to cover the operating costs of the Headquarters Office, but these revenues were not keeping up with the growth in yearly pension expenses. All pension costs were being paid out of the headquarter’s annual revenues,” the Cragos said. “And, it clearly wasn’t going to be enough to get the job done in the years to come,” they added. By the end of this year, EYN could have nearly 100 retirees, compared with only about 850 active employees.

Under the new plan, congregations will pay 27.5 percent and employees will pay 10 percent of each employee’s salary, including housing and transportation allowances. Ten percent of the employer’s contribution, matched by the employee’s 10 percent, will go into a savings account for the employee. The remaining employer’s 17.5 percent will go to fund the cost of current pensioners and to build reserves to cover the accrued pension liabilities of EYN for current employees. Each employee’s individual pension savings account will be held by a licensed pension custodian for each worker’s future benefit.

“This is huge step for EYN,” said the Cragos. The church is “committed now to fully funding both past and future retirement benefits for their employees. The real impact of this change–in a country where parents often say that they have children in order to ensure a decent retirement in old age–remains to be seen. It has the potential to change traditional social norms about retirement planning.”

EYN has stepped up to this new pension challenge sooner than most employers in Nigeria, the Cragos said. Even many government agencies have reportedly not yet implemented their plans.

In continuing work on the EYN plan, Tom Crago will help calculate the “net present value” of each employee’s accrued pension benefits as of June 25, 2004, when the new legislation took effect. He also will work with the new EYN Pension Board to develop daily operating procedures for the Pension Office. Janet Crago will develop an employee pension database for the Pension Office, and will handle some of the computer training for EYN staff who will maintain the data.


The Church of the Brethren Newsline is produced by Cheryl Brumbaugh-Cayford, director of news services for the Church of the Brethren General Board. Tom and Janet Crago contributed to this report. Newsline stories may be reprinted if Newsline is cited as the source. To receive Newsline by e-mail write to or call 800-323-8039 ext. 260. Submit news to For more news and features, subscribe to Messenger magazine; call 800-323-8039 ext. 247.


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