FG moves to curb contract inflation, bans variations without BPP clearance

The Bureau of Public Procurement on Sunday barred Ministries, Departments and Agencies from processing upward revisions of contract sums without first obtaining a Bureau certificate.

It also issued guidelines centralising the review of all contract variations and scope modifications under its authority.

According to a statement signed by its Head of Press and Public Relations, Zira Nagga, the bureau said the reform is designed to close one of the most persistent channels for cost inflation and corruption in Nigeria’s public procurement system.

The guidelines, issued pursuant to Sections 5(a) and (o) of the Public Procurement Act, 2007, give effect to a Federal Executive Council-approved policy conveyed by the Secretary to the Government of the Federation in December 2025.

The statement is titled “Contract Variations: BPP Release Guidelines.”

The new guidelines replace an earlier 2013 framework that required presidential approval only for variations above 15 per cent of the initial contract sum or N1bn.

Under the new framework, every request for a variation order, fluctuation claim, or scope modification—regardless of size—must first be submitted to the BPP for review and certification before it proceeds to the relevant approving authority.

Nagga noted that a BPP Certificate of No Objection, valid for six months, is now a mandatory precondition for any further action.

Variations processed without it will attract sanctions under the Public Procurement Act, 2007, including suspension of responsible officers and debarment of contractors, the statement said.

It also quoted the Bureau’s Director-General, Dr Adebowale Adedokun, as saying, “Variations must not become a backdoor for cost inflation and scope creep.

“These guidelines ensure that every adjustment to a public contract is necessary, justified, and delivers value to Nigerians.

“The BPP will apply these rules rigorously and fairly across all MDAs.”

Accordingly, the guidelines draw a firm line between permissible and impermissible grounds for variation.

Acceptable grounds include unforeseen site conditions, material errors in design or bills of quantities, statutory changes after contract execution, significant price escalation due to macroeconomic shocks or force majeure, and value engineering improvements that reduce cost without altering scope.

Variations arising from inadequate planning, avoidable design flaws, or the addition of new components not contemplated in the original contract scope will be rejected outright, Nagga noted.

Such additions, the guidelines stated, must be procured as entirely separate contracts, a provision aimed at blocking the practice of using variations to effectively award new projects under the cover of an existing contract.

On fluctuation claims—adjustments for changes in the cost of labour, materials, and exchange rates—the guidelines introduced new deterrents against deliberate project delays.

It said, going forward, contractors found to have intentionally slowed down execution in order to generate larger fluctuation claims will be denied those claims and may be debarred if the claims are found to be bogus or overstated.

The revised approving authority thresholds are now tied to the augmentation sum—the amount of the increase—rather than the total revised contract cost.

Works variations of N10bn and above will require Federal Executive Council approval.

“Those between N5bn and N10bn go to the Ministerial Tenders Board; those between N75m and N5bn to the Parastatal Tenders Board; and anything below N75m for works, or N50m for goods and services, can be approved at the Accounting Officer level,” it read.

Similar thresholds apply for goods and services procurement.

To address the upstream cause of many avoidable variations, the guidelines mandated the use of approved final designs for all procurements from the outset.

It also stated that the use of preliminary or flawed designs that subsequently generate unnecessary variations will attract regulatory sanctions, a provision that targets the entrenched practice of beginning projects with incomplete engineering designs.

On transparency, the BPP said all MDAs are required to publish details of every approved variation, including the contractor’s name, original contract sum, augmentation amount, revised contract sum, and grounds for the increase, on their websites and the BPP portal within 30 days of Tenders Board approval.

The BPP said it will also periodically submit council notes to the FEC on reviewed and approved variations across government.

The guidelines take effect immediately and apply to all ongoing projects, regardless of when the original contract was awarded.