In January 2026, indigenous contractors in Nigeria protested at the Federal Ministry of Finance in Abuja over unpaid bills for capital projects completed in 2024, with the debt estimated at over ₦4 trillion. The protest highlighted the need for a more efficient public procurement system. The contractors' association reported that only about ₦20 billion of the announced ₦152 billion payment had actually reached its members. This discrepancy underscores the challenges in Nigeria's public procurement and financial management systems.
The Nigerian government has since cleared over ₦700 billion in claims after a verification and reconciliation exercise. However, this process was largely manual, emphasizing the need for a more integrated digital system. The Bureau of Public Procurement (BPP), under Dr. Adebowale Adedokun, is accelerating the digitalization of federal procurement with the Digital Submission Portal and plans for an electronic Government Procurement (eGP) system, the Nigeria E-Marketplace, and other tools.
The Government Integrated Financial Management Information System (GIFMIS) provides a platform for budget execution, commitments, accounting, payments, treasury management, and financial reporting. GIFMIS already includes procurement within its scope, covering procurement commitments, purchase orders, and a central supplier register. The system requires a BPP reference, but currently, it is entered manually, not as a record that can be checked against BPP's own.
Integrating public procurement with GIFMIS would create a single digital chain from budget to contract, payment, and public value. This integration would strengthen expenditure discipline by enforcing two key principles: no procurement without an approved budget and procurement plan, and no payment without a valid procurement and contract record. A Federal Treasury Circular dated 31 July 2026, bars MDAs from issuing letters of award or signing contracts without a Warrant or Authority to Incur Expenditure.
The circular also directs MDAs to generate warrants from GIFMIS and attach copies before contracts are awarded or payments processed. BPP was directed to process only applications for Certificates of No Objection backed by valid warrants. While this move is in the right direction, automating the relationship between procurement and financial management would be more efficient.
The next major public procurement reform in Nigeria should focus on integrating procurement with the entire public financial management cycle. This integration would close the gap between budgeting, procurement, contract management, accounting, and payment, reducing risks at every stage. It would also provide a more accurate and transparent record of public expenditure.
By deepening the interoperability between BPP's emerging digital procurement ecosystem and GIFMIS, procurement and financial information can become parts of the same expenditure record. This integration would ensure that government can confidently know what its money has physically delivered, addressing the informational and fiscal challenges highlighted by the contractor arrears dispute.
Key points
- The Nigerian government aims to integrate public procurement with the Government Integrated Financial Management Information System (GIFMIS) for efficient expenditure.
- The integration will enforce expenditure discipline by linking procurement to approved budgets and valid contracts.
- Automating the relationship between procurement and financial management will reduce risks and provide a more accurate record of public expenditure.
