(DDM) – The Office of the Accountant-General of the Federation (OAGF) has engaged chief executives of Ministries, Departments, and Agencies (MDAs) on new measures for the transition from the 2024 budget to the 2025 fiscal year.
The session, held in Abuja on Wednesday, focused on implementing the 2025 capital budget and addressing financial compliance concerns.
Accountant-General of the Federation, Shamseldeen Ogunjimi, said the Federal Government had adopted a cash management and bottom-up cash planning policy to ensure efficient execution of the 2025 capital budget.
He explained that the policy is designed to provide strategies for cash flow planning and management, guaranteeing that funds reach end-beneficiaries promptly while ensuring value for money in public expenditure.
Ogunjimi warned that the government had observed disturbing trends among some MDAs.
These included awarding contracts solely based on budgetary provisions without considering existing laws, prioritising new projects over completing critical ongoing ones, and transferring funds to vendors before contract execution.
He also noted issues of non-realisation of targeted revenue and cases where MDAs failed to remit generated revenue to the treasury.
“This government will not fold its hands while institutions and individuals entrusted with real responsibilities deliberately disregard extant laws and regulations in the award and execution of capital projects,” Ogunjimi said.
He emphasised that full compliance with the Public Procurement Act 2007, the Fiscal Responsibility Act 2007, and other regulations was now mandatory.
Under the new directive, warrants will be issued to MDAs before any legal contract commitment, serving as proof that funds are available for project execution or payment processing.
Ogunjimi stated that no letter of award or contract signing should occur without the corresponding warrant being released.
“This is a call for you all to prudently manage the limited resources allocated to your MDA and optimise revenue realisation,” he added.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said the bottom-up policy aims to make government payments more transparent, rigorous, and accountable.
He explained that payments will now be made directly from the government to service providers, eliminating unnecessary bottlenecks.
Edun stressed that government must only spend what it earns, ensuring financial discipline in budget implementation.
Director of Funds at OAGF, Steve Ehikhamenor, revealed that the extension of the 2024 capital budget into 2025 meant all 2024 financial commitments were carried over.
This resulted in N10.5 trillion from the 2024 capital budget being automatically added to the 2025 budget, significantly increasing the funding requirement.
Ehikhamenor said the move underscored the need for MDAs to manage funds judiciously and comply strictly with the new directives.