FG earmarks N1.7tn in 2026 price range for unpaid contractors

The Federal Authorities has budgeted the sum of N1.7tn within the 2026 Appropriation Invoice to settle excellent money owed owed to contractors for capital initiatives executed in 2024.

A breakdown of the proposed 2026 nationwide price range reveals that the quantity is captured beneath the road merchandise titled “Provision for 2024 Excellent Contractor’s Liabilities,” signalling official recognition of delayed funds to contractors amid latest protests over delayed settlements.

This budgetary provision follows mounting strain from indigenous contractors and civil society teams who, in 2025, raised alarm over unpaid contractual obligations allegedly exceeding N2tn.

Some teams beneath the All Indigenous Contractors Affiliation of Nigeria had additionally staged demonstrations in Abuja, lamenting the extreme influence of delayed funds on their operations, with many contractors reportedly unable to service financial institution loans taken to execute authorities initiatives.

Earlier, Minister of Works David Umahi had promised to clear verified arrears owed to federal contractors earlier than the tip of 2025. Nonetheless, solely partial funds have been made amid income constraints, prompting the inclusion of the N1.7tn line merchandise within the 2026 price range as a catch-up mechanism.

Along with the N1.7tn for 2024 liabilities, the federal government has additionally budgeted N100bn for a separate line merchandise labelled “Fee of Native Contractors’ Money owed/Different Liabilities”, which can cowl legacy money owed from earlier years, smaller contract claims, or unsettled monetary commitments that weren’t totally verified within the present audit cycle.

The entire N1.8tn allocation is a part of the broader N23.2tn capital expenditure within the 2026 fiscal plan, which seeks to ramp up infrastructure supply whereas cleansing up previous obligations.

Nigeria’s contractor debt backlog has been a recurring fiscal difficulty, worsened by delayed capital releases, partial cash-backing of budgeted initiatives, and underperformance in income targets.

Talking with journalists on the entrance of the Federal Ministry of Finance in December 2025, the Nationwide Secretary of the All Indigenous Contractors Affiliation of Nigeria, Babatunde Seun-Oyeniyi, mentioned the federal government’s failure to launch funds after a number of assurances had compelled contractors to renew protests. He mentioned members of the affiliation have been owed greater than N500bn for initiatives already accomplished and commissioned.

He defined that regardless of latest assurances from the Minister of Finance, Wale Edun, no cost had been made. “After the Nationwide Meeting intervened, they advised us that they are going to sit the minister down over this matter.  And we instantly stopped the protest,” he mentioned.

In keeping with him, repeated follow-up conferences with the minister had produced no tangible progress. “They haven’t responded to our request,” he mentioned. “Actually, greater than six occasions we’ve got come right here. Final week, we have been right here all through the evening earlier than the Minister of Finance got here.”

Oyeniyi mentioned that though some cost warrants had been sighted, no funds had been launched. “Particularly, once we collate, they’re owing greater than N500bn for all indigenous contractors. We solely see warrants; there isn’t any money again.”

He accused officers of trying to push the funds into the subsequent fiscal yr. “The issue is that they wish to put us right into a backlog. They wish to shift us to 2026; that 2026, they’ll pay,” he alleged. “They’ll flip us into debt, and we don’t need that. We gained’t go away right here till we’re paid.”

Nonetheless, The PidomNigeria noticed that earlier in August 2025, the Federal Authorities claimed that it had cleared over N2tn in excellent capital price range obligations from the 2024 fiscal yr, with a pledge to prioritise the well timed launch of 2025 capital funds.

The Minister of Finance and Coordinating Minister of the Economic system, Wale Edun, disclosed this at a ministerial press briefing in Abuja, the place he additionally declared that Nigeria is “open for enterprise” to world buyers on the again of improved financial stability.

“Within the final quarter, we did pay contractors over N2tn to settle excellent capital price range obligations. That’s from final yr,” Edun mentioned. “For the time being, we’ve got no pending obligations that aren’t being processed and financed. And the main target will now shift to 2025 capital releases.”

By December 2025, The PidomNigeria reported that President Bola Tinubu expressed “grave displeasure” over the backlog of unpaid federal contractors and arrange a high-level committee to resolve the bottlenecks and fund repayments.

Briefing State Home correspondents after the Federal Government Council assembly in Abuja, Particular Adviser on Info and Technique, Bayo Onanuga, mentioned the President was “upset” after studying that about 2,000 contractors are owed. “He made it very, very clear he’s not completely satisfied and needs a one-stop resolution,” Onanuga advised journalists.

Tinubu directed the organising of a committee to confirm all claims from federal contractors. The brand new price range’s provisions are anticipated to attract from the end result of that verification train and could also be disbursed in tranches based mostly on confirmed and authorized claims.

The entire proposed 2026 nationwide price range stands at N58.47tn, with N23.2tn earmarked for capital expenditure, N15.9tn for debt servicing, N15.25tn for recurrent spending, and N4.09tn for statutory transfers.