The resolution of a 17-year legal dispute between Kwara State Government and 3,060 pensioners over N502 million in withheld gratuity and pension arrears faces renewed uncertainty after pensioners rejected the state's proposed out-of-court settlement terms.

The protracted case, which saw the Court of Appeal mandate an amicable resolution in 2023, had initially drawn consent from both parties. However, pensioners now formally declined the government's revised terms, citing inadequate compensation for decades of withheld entitlements.

A pensioners' representative stated: "The offer fails to address accumulated interest and inflation over 17 years. We demand full payment of the N502 million as originally awarded by the court."

The stalemate threatens to return the matter to litigation, prolonging financial distress for retirees who have endured delayed payments since 2008. The state government has yet to issue a formal response to the rejection.

The legal battle started in 2008 when the then Governor Bukola Saraki's administration unilaterally deducted and withheld 50 per cent of the pensioners' gratuity and pension arrears.

The pensioners were then entitled to be paid N1.4 billion, but the government of the day paid only half of the amount.

The pensioners, through their counsel, Timothy Gbadeyan, are contending that a "repayment of the applicants' deducted and withheld pension and gratuity arrears back to them in 2025 in the sum in which they were paid the first tranche in 2008 is so much devalued.

"The entire 3,060 accredited applicants before the CAMC with their names and amount paid to them in April, 2005, as contained in the prepared list duly exchanged inter parte and endorsed as correct are entitled to receive and or be paid their deducted and withheld pension and gratuity arrears as maybe upwardly reviewed by the state government due to the undeniable devaluation of the Nigerian currency; all the applicants entitled to receive the 50 per cent deducted and withheld pension and gratuity arrears; payment of N36 million to the applicants being cost of prosecuting this action from September 2008 to date since their investment in time, energy and finance revealed to the state government.

"The state government will upset and pay the applicants' counsel the 10 per cent professional fees of the N1.6 billion claimed by the applicants; all payments to the applicants who are spread everywhere in the world and with so many of the deceased be made through Deji Gbadeyan & co client's account and a-five man judgment claim verification and payment committee."

In their response to the state government's proposal, the pensioners clarified before the mediation centre that "before any payment whatsoever was made in 2008, the 3,060 applicants were entitled to N1.4 billion. In the first tranche in April, 2008, the 3,060 applicants were paid N502 million and deducted and with the remaining N502 million withheld.

"It is, therefore, not correct to say that 50 per cent deducted in 2008 is not N251 million.

"If the need arises, let CAMC subject the amount payable but deducted in 2008 as contained in the aggrieved list of the 3,060 applicants to any form of computation method either through artificial intelligence or any other acceptable method."

But the state government is proposing payment of 50 per cent of N502 million as gratuity and pension arrears to the retirees.

In his response to the pensioners' terms of payment, the state Justice Commissioner and Attorney-General, Ibrahim Sulyman, said that "having considered the proposed terms of settlement of the appellants dated March 4, 2025, the following terms of settlement are hereby proposed in the spirit of mediation as encouraged by the court: the payment of 50 per cent of the total amount due to the 3,060 pensioners as calculated by the pension board amounting to N251, 212million as final payment with regards to all issues related to the pensioners in this case; that the approved sum will be paid at once directly into the pensioners' individual accounts.

The AG rejected the request for the payment of N36 million as cost of litigation, describing it as unacceptable.

He also opposed the demand for the payment of 10 per cent of N1.6 billion as professional fees, claiming it is also unacceptable.

"The judgment claims and verification processes shall be based on the agreed list of 3,060 duly cleared and verified by the pension board and; that this proposal represents the stand and position of the state government on this case for amicable settlement of the case," the commissioner said.