June 8 (THEWILL) — The Federal Government has approved payments to more than 1,240 local contractors in a move expected to provide immediate financial relief to businesses across the country and strengthen confidence in government obligations.
The approval, granted through the Federal Ministry of Finance, forms part of ongoing efforts to settle verified outstanding obligations owed to contractors engaged by various Ministries, Departments and Agencies (MDAs).
In a statement issued on Monday by the Head of Information and Public Relations Unit, Efe Ovuakporie, the Ministry stated that the latest payments followed a detailed verification and reconciliation exercise to ensure that only duly validated claims qualified for disbursement.
According to the statement, the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, approved the payments as part of the government’s broader strategy to support businesses, improve liquidity and stimulate economic activities nationwide.
It noted that the initiative would particularly benefit indigenous firms and small and medium-sized enterprises (SMEs), many of which have faced operational challenges arising from delayed payments and constrained cash flow.
The statement further disclosed that contractors prioritised in the latest payment batch are those with verified claims of ₦100 million or below. It added that the disbursement is expected to provide immediate support to hundreds of businesses, enabling beneficiaries to return to project sites, settle outstanding obligations to suppliers, pay salaries and workers, meet financial commitments and strengthen business operations.
The Ministry described the development as another demonstration of government’s commitment to converting fiscal policy objectives into tangible economic outcomes through transparent and responsible settlement of inherited obligations.
It also revealed that over the past few months, the Federal Government has processed payments exceeding ₦700 billion across various categories of verified obligations owed to local contractors.
Providing further insight into recent payment activities, the Ministry disclosed that approximately ₦436.6 billion worth of transactions were processed in May alone, reflecting a significant acceleration in payment activities aimed at improving liquidity and driving economic growth. It noted that by prioritising a larger number of smaller contractors rather than concentrating payments among a few large beneficiaries, the government intends to broaden the economic impact of the disbursements across sectors and regions.
The Ministry expressed optimism that the latest round of payments would strengthen confidence among contractors, suppliers and service providers working with government institutions.
“For many beneficiaries, the release of funds represents more than a financial transaction. It provides the certainty needed to sustain operations, preserve jobs, complete ongoing projects and contribute to economic recovery and growth”, the statement read.
Reaffirming its commitment to prudent financial management, the Ministry said it would continue to ensure fiscal discipline while pursuing the timely settlement of legitimate obligations.
It added that the approach would substantially reduce outstanding liabilities over time, strengthen confidence in public financial management and support efficient delivery of public services and infrastructure across the country.
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