The Federal Government has disclosed that it has processed payments exceeding N700 billion in verified obligations owed to indigenous contractors in recent months, with N436.6 billion of the amount disbursed in May alone as part of efforts to settle long-standing liabilities and stimulate economic growth.
This was revealed in a statement issued on Monday by the Director of Information and Public Relations at the Federal Ministry of Finance, Efe Ovuakporie. The ministry noted that payment approvals had been granted to more than 1,240 contractors across various Ministries, Departments and Agencies (MDAs).
According to the statement, the approvals were authorised by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, after a comprehensive verification and reconciliation process designed to ensure that only legitimate and validated claims were considered for settlement.
The ministry explained that the latest round of payments marks a significant milestone in the government’s ongoing efforts to resolve inherited financial obligations, particularly those affecting local businesses, contractors, and small and medium-sized enterprises operating across the country.
It stated that the move demonstrates the government’s commitment to meeting its financial responsibilities while injecting liquidity into the economy.
“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 ministry further disclosed that contractors with verified claims of N100 million or less were given priority in the most recent payment phase, a strategy aimed at extending support to a broader range of businesses and enhancing the impact of the intervention across different sectors.
Officials explained that the release of funds is expected to provide critical financial relief to numerous contractors by enabling them to resume stalled projects, pay outstanding wages, settle supplier obligations, and fulfil other financial commitments.
“Contractors prioritised for payment in the most recent batch are those with verified claims in the region of N100m or less. The release of funds is expected to provide immediate relief to hundreds of businesses, enabling them to return to project sites, pay workers, settle suppliers, meet financial commitments, and support economic activity across the country,” the statement added.
The ministry described the initiative as part of a broader effort to address outstanding obligations inherited by the current administration in a transparent, accountable, and fiscally responsible manner.
It noted that the accelerated pace of payments in recent months reflects the government’s determination to translate economic policies into measurable outcomes that directly benefit businesses and citizens.
Providing further details, the ministry disclosed that payment activities witnessed a major increase in May, when approximately N436.6 billion worth of transactions were processed.
“Over the past few months, the Federal Government has processed payments exceeding N700bn across various categories of verified obligations owed to local contractors. Within the month of May alone, approximately N436.6bn in transactions were processed, demonstrating a significant acceleration in payment activity aimed at unlocking liquidity and supporting economic growth,” the ministry stated.
The statement highlighted that by focusing on a large number of smaller contractors rather than concentrating payments among a few large beneficiaries, the government was ensuring that the economic benefits of the disbursements are spread more widely across sectors, communities, and regions.
According to the ministry, the payments are expected to strengthen confidence among contractors, suppliers, service providers, and other stakeholders who do business with the government, while helping businesses sustain operations, preserve jobs, and complete ongoing projects.
The ministry reiterated its commitment to maintaining fiscal discipline and ensuring the timely settlement of legitimate obligations, stressing that such measures would reduce the backlog of outstanding debts, improve confidence in public financial management, and support the delivery of infrastructure and essential public services.
The development comes against the backdrop of the Federal Government’s allocation of N1.7 trillion in the 2026 Appropriation Bill for the settlement of outstanding debts owed to contractors for capital projects executed in 2024, reflecting continued efforts to clear inherited liabilities and improve the business environment.
