The Federal Government has processed payments of over ₦700 billion of verified obligations owed to local contractors as part of efforts to clear long-standing debts and inject liquidity into the economy.
The Federal Ministry of Finance disclosed this in a statement issued by its Director of Information and Public Relations, Efe Ovuakporie, on Monday, June 8, 2026, according to a report.
The ministry said a total of about ₦436.6 billion was processed in the month of May alone while payments had also been approved for more than 1,240 contractors from the various Ministries, Departments and Agencies.
The ministry said the payments followed a verification and reconciliation exercise to ensure that only duly validated claims were paid and were approved by the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele.
The most recent disbursements were part of the government’s efforts to address inherited payment obligations, particularly debts affecting indigenous contractors, small businesses and medium-sized enterprises, it said.
1,240 Contractors Benefited
The ministry said the payment approvals would provide immediate support to businesses across the country and boost confidence in the government’s commitment to honouring its obligations.
“The Federal Ministry of Finance has approved payments to over 1,240 contractors, providing immediate liquidity support to businesses across the country, and reaffirming the Federal Government’s commitment to meeting its financial obligations,’’ the statement read.
It said in the latest batch of payments, contractors with verified claims of ₦100m or less were prioritised.
The ministry said the decision was made to provide relief to smaller contractors, many of whom have been hampered by delayed payments and could use the relief to start operations and meet pressing financial obligations.
“Contractors who are prioritised for payment in the latest batch are those with verified claims in the region of ₦100m or below. The ministry said the release of funds is expected to bring immediate relief to hundreds of businesses, enabling them to return to project sites, pay workers, settle suppliers, meet financial obligations, and support economic activity across the country.”
The ministry also said payment activities had surged in recent months with ₦436.6bn processed in May alone.
The development, it said, was a renewed push by the government to clear verified debts and support economic growth through improved cash flow to contractors and service providers.
“The Federal Government has made payments of over ₦700bn under different categories of verified obligations to local contractors in the past few months. “Transactions worth about ₦436.6bn were processed in May alone, marking a sharp acceleration in payment activity to unlock liquidity and drive economic growth,” the statement said.
The ministry said the payments would enable beneficiaries to resume work at abandoned or delayed project sites, pay workers, settle suppliers and complete ongoing projects.
The approach would also help preserve jobs and support economic activities across sectors and regions, it added.
The ministry said the government deliberately gave priority to a large number of smaller contractors rather than concentrating the payments among a few major beneficiaries.
It explained that this would help to broaden the economic impact of the disbursements and ensure that more businesses across the country benefit from the payment exercise.
The latest payments are expected to build confidence among contractors, suppliers and service providers doing business with the government, the statement said.
The disbursements were also in line with the administration’s commitment to address inherited liabilities in a transparent and fiscally responsible manner, the ministry said.
The Federal Ministry of Finance said it was committed to meeting its legitimate obligations at the appropriate time, adding that the government would continue to apply verification and reconciliation processes before payments were made.
It said the approach would help to reduce outstanding liabilities, improve public financial management and support the delivery of public services and infrastructure.
This development follows reports that the Federal Government has allocated ₦1.7 trillion in the 2026 Appropriation Bill to pay off outstanding debts owed to contractors for capital projects executed in 2024.
