FG has released payments to over 1,240 local contractors as part of efforts to clear outstanding debts and boost economic activity. The move, announced by Finance Minister Taiwo Oyedele, focuses on verifying claims before disbursing funds to ensure accuracy. The payments target indigenous firms and small businesses that have faced delays in receiving government money.
The ministry prioritized contractors with verified claims of N100 million or less in the latest round. Officials said the release will help businesses resume projects, pay workers, and meet financial obligations. This follows a broader push to settle N700 billion in verified debts owed to contractors over recent months, with N436.6 billion processed in May alone.
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Authorities argue this approach will spread economic benefits across sectors and regions. Delays in payments have long strained businesses, forcing some to halt projects or accumulate debt while waiting for settlements. By accelerating disbursements, the government aims to improve private sector cash flow and support infrastructure projects.
Contractors with verified claims are receiving payments after a reconciliation process. The ministry said this step will help preserve jobs and sustain operations for businesses reliant on public sector contracts. The government also aims to restore trust in public finances as part of broader fiscal reforms.
The strategy shifts focus from a few large beneficiaries to a wider base of smaller contractors. Officials expect the move to strengthen confidence among contractors, suppliers, and service providers working with public institutions. The ministry emphasized its commitment to fiscal discipline while ensuring timely payment of legitimate obligations.
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The finance ministry noted that outstanding liabilities have been a persistent challenge. The current effort seeks to reduce these debts over time, improve public financial management, and ensure infrastructure and service delivery projects stay on track. The focus on smaller firms reflects a broader attempt to stimulate growth in an economy facing high inflation and borrowing costs.
The release of funds is expected to ease financial pressures on businesses, particularly those struggling with delayed payments. By addressing backlogs, the government hopes to prevent project suspensions, job cuts, and debt accumulation. The focus on verified claims ensures resources are directed to legitimate obligations.
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Officials highlighted that the approach balances fiscal responsibility with economic stimulus. While large-scale payments have historically dominated, the shift to smaller contractors is intended to maximize sectoral and regional impact. The ministry reiterated its goal of reducing outstanding liabilities and improving the efficiency of public spending.
The ministry remains cautious about maintaining fiscal discipline. It stressed that future payments will depend on verifying claims and ensuring transparency. The broader aim is to strengthen public confidence in financial management while supporting economic recovery. The move aligns with President Tinubu’s efforts to stabilize the economy amid ongoing challenges.