The federal government has approved payments to more than 1,240 local contractors as part of efforts to stimulate economic activity, support businesses and accelerate the execution of public projects across the country.
The approval, granted by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, followed an extensive verification and reconciliation exercise carried out by the Federal Ministry of Finance to validate outstanding claims submitted by contractors engaged by Ministries, Departments and Agencies.
According to the ministry, the latest disbursement exercise focused largely on indigenous contractors and small and medium-sized enterprises with verified claims not exceeding N100 million.
Officials explained that prioritising smaller claims was intended to ensure broader economic impact by distributing funds among a larger number of businesses instead of concentrating payments among a few major contractors.
The ministry stated that the release of funds would provide immediate financial relief to contractors facing liquidity challenges, enabling them to return to project sites, pay salaries, settle supplier obligations and continue ongoing government projects.
In a statement issued by the Senior Special Assistant on Communication and Press Secretary to the Minister of Finance, Mary-Ann Duke, the government said the exercise aligns with its commitment to transparent and fiscally responsible settlement of inherited liabilities.
The statement disclosed that the federal government had processed payments exceeding N700 billion in verified obligations owed to local contractors in recent months.
It added that about N436.6 billion worth of transactions were processed in May alone, reflecting a significant increase in payment activity aimed at improving liquidity within the economy and supporting enterprise growth.
The ministry maintained that the decision to prioritise payments to smaller contractors would help spread economic benefits across multiple sectors and regions of the country.
Analysts believe the move could improve confidence among contractors, suppliers and service providers working with government institutions, particularly businesses dependent on public sector contracts.
The ministry also expressed optimism that the settlement of verified obligations would strengthen confidence in government procurement and public financial management processes.
“For many beneficiaries, the release of funds represents more than a financial transaction,” the statement noted. “It provides the certainty needed to sustain operations, preserve jobs, complete ongoing projects, and contribute to economic recovery and growth.”
The Federal Ministry of Finance reaffirmed its commitment to fiscal discipline while ensuring that legitimate obligations are settled promptly, adding that ongoing efforts to reduce outstanding liabilities would support infrastructure delivery and improve confidence in public finance administration nationwide.
