President Bola Ahmed Tinubu has approved a major overhaul of Nigeria’s public procurement system, aimed at improving efficiency, decentralizing decision-making, and promoting transparency in government contracting. The new policy, announced on Friday, introduces revised thresholds for contract approvals and strengthens the country’s commitment to local industry development.
Under the updated framework, the Federal Executive Council (FEC) will be responsible for approving contracts worth N5 billion and above for goods and services, and N10 billion and above for works. This centralization of higher-value contract approvals is part of an effort to streamline processes and ensure government oversight of significant financial commitments.
For smaller projects, the approval responsibilities have been decentralized. The Ministerial Tenders Board will now handle contracts ranging from N50 million to N1 billion for goods and services, and from N50 million to N2.5 billion for works. Additionally, the Parastatal Tenders Board will oversee contracts up to N500 million for goods and services, and N1 billion for works. Accounting officers of Ministries, Departments, and Agencies (MDAs) will be authorized to approve contracts below N50 million for goods and services and contracts below N100 million for works.
To ensure the proper execution of these projects, the framework outlines specific procurement methods based on the value of contracts. Contracts worth N1 billion or more for goods and services, or N5 billion or more for works, will be subject to the National and International Competitive Bidding process. Smaller projects will require consultancy-based processes.
In an effort to enhance transparency, the policy mandates that MDAs publish monthly procurement reports on their official websites and the Bureau of Public Procurement (BPP) portal, detailing all awarded contracts. Furthermore, MDAs are required to budget for procurement training and ensure that only BPP-accredited trainers conduct these sessions.
A key aspect of the new procurement rules is the emphasis on local content. The policy directs that MDAs prioritize the use of local goods and contractors for all federal procurements, in line with the administration’s “Nigeria First” policy. This initiative aims to stimulate domestic industries, reduce reliance on imports, and create jobs for Nigerians.
Additionally, the federal government has instructed MDAs to avoid procuring foreign goods and services when local alternatives are available. This policy is seen as a strategy to bolster Nigeria’s economy by supporting local manufacturers and reducing the country’s dependency on foreign products.
Overall, the sweeping procurement reforms are expected to drive economic growth, enhance the efficiency of public spending, and ensure that government projects comply with the highest standards of transparency and accountability.
