Nigeria Bars MDAs From Awarding Contracts Without Budget Approval, Cash Backing

‎The Nigerian Federal Government has directed all Ministries, Departments and Agencies (MDAs) to stop awarding contracts or entering into financial commitments without first obtaining budget approval and cash backing.

‎ ‎The directive, contained in a Treasury Circular dated July 31, 2026, was signed by the Accountant-General of the Federation, Dr. Shamseldeen Ogunjimi.

‎According to the circular, the move is aimed at strengthening fiscal discipline and ensuring compliance with the Public Procurement Act and other financial regulations after repeated cases of non-compliance.

‎ ‎Under the new guidelines, MDAs must secure a Warrant or Authority to Incur Expenditure (AIE) before awarding contracts, signing agreements, or making financial commitments.

‎ ‎They are also required to provide evidence of available funds through the Government Integrated Financial Management Information System (GIFMIS).

‎ ‎The directive is part of the Tinubu administration's efforts to strengthen public financial management, improve transparency, reduce abandoned projects, and ensure that government contracts are awarded only when funds are available.

‎ ‎The government further directed that all financial commitments must remain within approved budget limits, while the Bureau of Public Procurement will only process requests for No Objection certificates backed by valid Warrants or AIEs.

‎ ‎The Accountant-General warned that awarding contracts without budgetary provision, approval, and cash backing is an offence under the ICPC Act.

‎ ‎The circular also requires MDAs to submit annual and quarterly cash plans to improve budget implementation and ensure that projects are prioritised based on the Federal Government's development objectives. ‎