Ministries, Departments, and Agencies (MDAs) have been barred from signing contracts or making financial commitments without securing prior budgetary authorisation and cash backing, as part of a fresh federal crackdown on fiscal indiscipline.
The enforcement measure comes in response to widespread non-compliance with the Public Procurement Act, 2007, alongside other statutory spending frameworks. According to official guidelines issued for the implementation of the 2026 capital budgets, the measures aim to enforce strict adherence to existing procurement laws and tighten public expenditure management.
Under the directive, MDAs are prohibited from issuing award letters, executing contracts, or incurring liabilities without obtaining a Warrant or Authority to Incur Expenditure (AIE).
The guidelines specify that: “no MDA shall issue letters of award, sign contracts, or enter into any financial obligations unless the corresponding Warrant/AIE covering the full or committed portion of the contract sum has been duly released by the Honourable Minister of Finance and Coordinating Minister of the Economy to the Accountant-General of the Federation.”
The mandates were set out in a Federal Treasury Circular dated 31 July 2026, signed by the Accountant-General of the Federation, Dr Shamseldeen Ogunjimi.
Circulated to ministers, permanent secretaries, agency heads, accounting officers, and federal pay officers, the directive expands upon earlier cash management guidelines. Dr Ogunjimi explained that strengthening the policy had become imperative to curb ongoing violations, reiterating that “no expenditure shall be incurred except on the authority of a Warrant/AIE”.