Nigerian Govt bars MDAs from awarding contracts without proof of funds

The Nigerian government has directed that ministries, departments, and agencies (MDAs) must not award contracts without a warrant authority to incur expenditure (AIE).

Minister of Finance, Wale Edun, announced this on Wednesday in Abuja during an event on the implementation of extended capital budgets under the Bottom-Up Cash Planning Policy.

He explained that the move is intended to ensure prudent management of public resources.

According to the minister, the Accountant-General of the Federation has been instructed to develop a new process allowing MDAs to download and attach warrants/AIEs as proof of funds availability during tender board meetings.

“Henceforth, Warrants/AIEs will be issued to MDAs before any legal commitment, serving as evidence of funds for contract awards or payment for ongoing and completed projects. No letter of award should be issued, no contract signed, or financial obligation entered into without the corresponding Warrants/AIEs covering the full or committed contract sum,” he said.

Edun emphasized the need for MDAs to manage limited resources prudently and optimize revenue collection as funds become available.

He also highlighted that measures are being put in place to implement the 2024 and 2025 capital budgets, particularly focusing on priority government projects.

The announcement comes after Bauchi Central Senatorial District lawmaker, Abdul Ahmed Ningi, previously raised concerns over the non-payment of contractors last year.