Tinubu Shakes Up Contract System: No FEC Approval Needed For Deals Under ₦5 Billion

President Bola Ahmed Tinubu has approved a major policy shift, announcing that contracts and procurement of goods and services valued below ₦5 billion will no longer need Federal Executive Council (FEC) approval.

The update was made known in a statement issued Thursday by Zira Nagga, spokesperson for the Bureau of Public Procurement (BPP).

Under the new procurement framework, Ministries, Departments, and Agencies (MDAs) are now authorized to manage procurement contracts independently, provided the project value falls below ₦5 billion.

The BPP explained that the changes aim to reduce bureaucratic delays and boost operational efficiency within government agencies. It also stated that national or international competitive bidding must be used for procuring goods worth ₦1 billion or more, and for works starting from ₦5 billion.

According to the agency, only contracts above ₦5 billion for goods and consultancy services and ₦10 billion for public works will now require FEC clearance. Contracts below those thresholds will be handled by the Ministerial Tenders Board, Parastatal Tenders Board, or by designated Accounting Officers, depending on the project cost.

The BPP noted that these thresholds are subject to periodic review based on economic conditions and emphasized strict compliance.

For smaller-scale procurements, the Request for Quotations method will be allowed for goods and non-consultancy services under ₦30 million, and for works below ₦50 million. The new rules also set the minimum value for prequalification at ₦500 million for goods and services, and ₦1 billion for works.

The statement concluded with a stern warning: any official who attempts to undermine or obstruct the new procurement guidelines will face administrative sanctions, as recommended to the President.

This development follows Tinubu’s earlier approval of the Nigerian First Policy, which includes restrictions on the importation of foreign goods.