Finance Ministry, contractors clash again over outstanding debt

•Ministry announces payments of N700bn to 1,240 local firms

•We have yet to receive any funds – Contractors

By Emma Ujah, Abuja Bureau Chief & Progress Godfrey

In light of renewed demonstrations from contractors, the Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele, noted that payments have been authorized for over 1,240 contractors.

As stated in a release from Efe Ovuakporie, the Head of Information and Public Relations for the Ministry of Finance, “The most recent payments were prioritized for contractors with verified claims amounting to N100 million or below.

“The allocation of these funds is anticipated to give immediate assistance to numerous businesses, allowing them to return to their project locations, pay their employees, settle with suppliers, fulfill financial obligations, and stimulate economic activities throughout the nation.

“Recently, the Federal Government has disbursed over N700 billion in payments related to various verified debts owed to local contractors.

“In May alone, around N436.6 billion was processed in transactions, showcasing a notable increase in payment activities aimed at enhancing liquidity and fostering economic expansion.

“By focusing on a larger group of smaller contractors instead of just a few larger recipients, the Government is expanding the economic benefits of these payments, aiding businesses across various sectors and regions within the country.”

However, contractors affiliated with the All Indigenous Contractors Association of Nigeria (AICAN) resumed their protests at the Federal Ministry of Finance Headquarters in Abuja yesterday, expressing their frustrations over outstanding payments related to projects scheduled for 2024.

During the protest, the National President of AICAN, Mr. Jackson Nwosu, stated that roughly 85 percent of contractors had still not been compensated, despite previous assurances from government representatives regarding the processing of funds.

He clarified that the organization had been in talks with representatives from the Ministry of Finance and the Accountant General's Office, where they were informed that approximately N40 billion would be distributed to recipients initially.

Nwosu mentioned that contractors had already submitted validated lists of payments across various categories and anticipated that the funds would appear in accounts by the last Friday; however, this expectation was not realized.

"We were hopeful that all the funds would be deposited into the accounts of the beneficiaries by Friday, but that did not occur. From what we have observed, only a limited number of individuals have received their payments," he stated.

The National Secretary of the association, Mr Babatunde Seun, also expressed doubts regarding rumors that N700 billion had been disbursed to contractors, asserting that members had not witnessed any proof of such payments.

In response to the demonstrators, the Permanent Secretary (Special Duties) at the Ministry of Finance, Mr Mohammed Sanusi, explained that the approval of funds does not mean that payments will be immediate, emphasizing that the government is still addressing pending liabilities.

"Some of these funds have indeed been approved, let me clarify that approval does not mean payment; we have had discussions with the Accountant General and are actively processing payments to contractors.

"The Federal Government has approved N700 billion for contractors’ payments, and an additional N70 billion has been allocated for this association. Payments will commence any moment now," Sanusi reassured.