Fed Govt Bars Ministries From Awarding Unfunded Contracts

The Federal Government has barred Ministries, Departments and Agencies from awarding contracts or entering into any financial commitments without first securing the required budgetary approval and cash backing.

The directive which is contained in a Federal Treasury Circular and signed by the Accountant-General of the Federation, Dr Shamseldeen Ogunjimi said the move is aimed at tightening fiscal discipline and enforcing compliance with procurement laws.

The circular which was addressed to key government officials, including ministers, permanent secretaries, heads of extra-ministerial departments and agencies, accounting officers, and federal pay officers as fresh operational guidelines became necessary following widespread violations of the Public Procurement Act, 2007, and other financial regulations governing public expenditure.

A key provision of the circular stipulates that no MDA can issue letters of award, sign contracts, or incur financial obligations without first obtaining a Warrant or Authority to Incur Expenditure.

The Office of the Accountant-General also directed MDAs to download and attach copies of Warrants or AIEs generated through the Government Integrated Financial Management Information System as evidence that funds are available before contracts are awarded or payments are processed.

The circular further warned that financial commitments, including purchase invoices and employee payables, must not exceed the value of available warrants.