Minister of Finance and Coordinating Minister of the Economy, Wale Edun, has said that henceforth, Ministries, Departments, and Agencies (MDAs) will no longer be allowed to award contracts without cash backing.
He said the directive follows the federal government’s implementation of the Cash Management and Bottom-Up Cash Planning Policy, which sets out rules and guidance for planning and managing cash resources to ensure effective and efficient service delivery in executing the 2024 capital budget.
“Henceforth, Warrants/AIEs will be issued to MDAs before any legal commitment is made, serving as evidence of funds available for contract awards or payment for ongoing and completed projects. No letter of award, contract signing, or financial obligation should be undertaken without the corresponding Warrants/AIEs covering the full or committed portion of the contract sum,” Edun said.
He appealed to the MDAs to judisoulsy manage limited resources, optimise revenue collection, and enforce controls to prevent discretionary spending.
He also mandated the Accountant General of the Federation (AGF) to develop a new process that will allow MDAs to download and attach Warrants/AIEs as proof of funds during tender board meetings.
According to the minister of Finance, disbursement of funds will remain centralised in the Treasury, with priority given to funding extended 2024 and 2025 capital budgets, particularly priority projects.
