FG Vows Crackdown on Inflated Contracts, Procurement Violations

By Frontline Reporters

The Federal Government has vowed to sanction heads of government-owned agencies, corporations, councils, authorities and commissions found violating public procurement regulations, particularly through inflated contract costs and other irregularities.

The Secretary to the Government of the Federation (SGF), George Akume, issued the warning in a circular directing all accounting officers of federal government institutions to strictly comply with the Public Procurement Act, 2007, as amended by the Finance Act, 2020.

The circular, addressed to ministers, permanent secretaries and heads of government agencies and parastatals, expressed concern over the continued award of contracts outside established procurement guidelines, resulting in inflated costs, restricted competition and inadequate regulatory oversight.

Akume warned that the government would no longer tolerate such practices, stressing that accounting officers who disregard the procurement law would face appropriate sanctions.

The circular stated that some government-owned enterprises and corporations continued to award contracts without complying with Section 15 of the Public Procurement Act, despite its amendment by the Finance Act, 2020.

According to the SGF, the violations had resulted in contract sums exceeding approved pricing benchmarks, exclusive arrangements that restricted competition and significant departures from established procurement procedures.

He consequently directed all government-owned enterprises, corporations, councils, authorities and commissions that utilise public funds to ensure that their procurement activities comply with the Act.

The affected institutions were also instructed to liaise with the Bureau of Public Procurement (BPP) for guidance on implementing the regulations.

Akume specifically warned that heads of the institutions, who also serve as accounting officers, would be held responsible for any continued breach of the law.

The circular stated: “The Heads of Enterprises, Corporations, Councils, Authorities and Commissions, who are also the Accounting Officers, are hereby directed to liaise with the Bureau of Public Procurement for further guidance, as any Accounting Officer who contravenes this directive and continues to award contracts without recourse to the provisions of the Public Procurement Act, 2007, shall be sanctioned accordingly.”

The SGF further directed that the circular be brought to the attention of all accounting officers for immediate and strict compliance.

The Public Procurement Act, 2007, established the BPP as the regulatory authority responsible for monitoring public procurement, setting standards and ensuring transparency, competition and value for money in government contracts.

Section 15 of the Act, as amended by the Finance Act, 2020, extended its application to federal government-owned enterprises, corporations, councils, authorities and commissions, provided they utilise public funds.

Section 20 also places responsibility for procurement compliance on accounting officers, including permanent secretaries and heads of government agencies and corporations.

The latest directive comes amid a series of Federal Government measures aimed at strengthening procurement controls and curbing the inflation of public contract costs.

In October 2025, the Federal Executive Council directed the strict application of the Public Procurement Act across federal institutions. The decision, communicated through a circular issued by Akume, covered government-owned companies and enterprises, the National Assembly, the Judiciary, defence and security agencies and the Central Bank of Nigeria.

Similarly, in October 2026, the government introduced a mandatory 14-calendar-day standstill period between the announcement of an intended contract award and the finalisation of procurement contracts.

The measure was designed to allow unsuccessful bidders to seek clarification, request debriefing or lodge complaints before contracts are concluded.

The government has also strengthened sanctions against contractors involved in fraud, corruption, falsification of documents and persistent failure to execute public contracts.

Under the National Guideline on Debarment of Contractors, Consultants and Service Providers, contractors found culpable may be barred from participating in federal procurement for between three and five years.

Earlier, in May 2026, the BPP barred ministries, departments and agencies (MDAs) from processing upward revisions of contract sums without obtaining the bureau’s certification.

The bureau also introduced new guidelines centralising the review and approval of contract variations and modifications to project scopes, irrespective of the contract value.

The reforms replaced the 2013 framework, which required presidential approval only for contract variations exceeding 15 per cent of the initial contract sum or N1bn.

Under the revised guidelines, all requests for variation orders, fluctuation claims and project scope modifications must be submitted to the BPP for review and certification before being forwarded to the appropriate approving authority.

The bureau warned that contract variations processed without its certification could attract sanctions, including the suspension of responsible public officers and possible debarment of contractors.

The Director-General of the BPP, Dr Adebowale Adedokun, said the guidelines were introduced to prevent public institutions and contractors from exploiting contract variations to inflate project costs.

“Variations must not become a backdoor for cost inflation and scope creep,” he said, stressing that every adjustment to a public contract must be necessary, justified and deliver value for money.

In August 2026, Adedokun disclosed that the Federal Government had saved approximately N1.4tn in 18 months through the bureau’s price intelligence and benchmarking initiatives.

He explained that the initiative enabled the BPP to scrutinise project estimates submitted by government institutions and compare them with established pricing standards before granting procurement approvals.

According to him, the reforms had also compelled contractors to moderate their bids to avoid rejection over excessive pricing.

The BPP had earlier reported that its procurement reviews saved the Federal Government more than N303bn, $304.9m and €1.74m from inflated contract costs between January and September 2025.

The latest directive reinforces the government’s position that all institutions spending public funds must comply with established procurement regulations, with accounting officers bearing responsibility for transparency, accountability and value for money in public expenditure.