By Joy Yesufu
The Federal Government has disbursed more than N700 billion in verified payments owed local contractors in recent months, including N436.6 billion released in May alone, as part of efforts to clear outstanding obligations and stimulate economic activity.
The Federal Ministry of Finance disclosed this in a statement issued on Monday by its Director of Information and Public Relations, Mr. Efe Ovuakporie.
According to the ministry, payments have been approved for more than 1,240 contractors across various Ministries, Departments and Agencies (MDAs) following a comprehensive verification and reconciliation exercise.
The ministry said the approvals were granted by the Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele to ensure that only duly verified and validated claims qualified for settlement.
It described the disbursements as a major step towards addressing inherited liabilities, particularly those affecting indigenous businesses and small and medium-sized enterprises (SMEs).
“The Federal Ministry of Finance has approved payments to more than 1,240 contractors, providing immediate liquidity support to businesses across the country and reinforcing the Federal Government’s commitment to meeting its financial obligations,” the statement said.
The ministry noted that contractors with verified claims of N100 million or less were prioritised in the latest batch of payments, a move aimed at widening the economic impact of the intervention.
It explained that the release of funds would enable affected businesses to return to project sites, pay workers, settle suppliers, meet financial commitments and sustain operations.
According to the ministry, payment activities have accelerated significantly in recent months, with approximately N436.6 billion processed in May alone.
“Over the past few months, the Federal Government has processed payments exceeding N700 billion across various categories of verified obligations owed to local contractors.
“This demonstrates a significant acceleration in payment activity aimed at unlocking liquidity and supporting economic growth,” the statement added.
The ministry further stated that prioritising a large number of smaller contractors, rather than concentrating payments among a few major beneficiaries, would help to spread the benefits across multiple sectors and regions of the country.
It added that the payments are expected to strengthen confidence among contractors, suppliers and service providers engaged by government while supporting job retention, project completion and broader economic activity.
The ministry reaffirmed the government’s commitment to fiscal discipline, transparency and the timely settlement of legitimate obligations, noting that the approach would help reduce outstanding liabilities, strengthen confidence in public financial management and improve public service delivery.
The latest development comes against the backdrop of the N1.7 trillion earmarked in the 2026 Appropriation Act for the settlement of outstanding debts owed to contractors for capital projects executed in previous years.
