The Federal Government has introduced tougher measures to curb contract inflation and procurement fraud, directing all Ministries, Departments and Agencies to obtain approval from the Bureau of Public Procurement before processing any contract variation or upward review.
The new directive, announced by the BPP on Sunday, centralises the approval of contract variations, fluctuation claims and scope adjustments under the bureau’s supervision.
In a statement signed by the Head of Press and Public Relations, Zira Nagga, the agency said the move is aimed at blocking loopholes often exploited to inflate project costs and divert public funds.
Under the new guidelines, every request for additional funding, price adjustment or project scope modification must first receive a BPP Certificate of No Objection before it can proceed to any approving authority.
The bureau explained that the certificate, which will remain valid for six months, is now compulsory for all contract variations, regardless of the amount involved.
According to the BPP, any variation approved without its clearance will attract sanctions under the Public Procurement Act, including suspension of public officials involved and possible blacklisting of contractors.
Speaking on the reform, BPP Director-General, Dr Adebowale Adedokun, said contract variations must no longer serve as a hidden route for inflating project costs.
He stressed that every adjustment to public contracts must be properly justified, necessary and beneficial to Nigerians, adding that the bureau would strictly enforce the new rules across all government institutions.
The guidelines clearly outlined conditions under which variations may be approved. These include unforeseen site challenges, errors in original project designs, changes in government regulations after contract award, major economic disruptions affecting prices, and engineering improvements that reduce costs without altering the project scope.
However, the BPP warned that requests caused by poor planning, avoidable design mistakes or the addition of entirely new project components would be rejected.
The agency added that any new component outside the original contract scope must be treated as a separate project and awarded through a fresh procurement process.
The government also introduced stricter controls on fluctuation claims linked to increases in labour, material and exchange rate costs.
Contractors accused of deliberately slowing down projects to generate higher claims risk losing such claims entirely and could face debarment if found guilty of submitting exaggerated or fraudulent requests.
The revised framework also changes approval thresholds by focusing on the amount being added to a contract rather than the total revised contract value.
Under the new structure, works variations of N10bn and above will require Federal Executive Council approval, while requests between N5bn and N10bn will go through the Ministerial Tenders Board.
Variations between N75m and N5bn will be handled by the Parastatal Tenders Board, while lower amounts can be approved by accounting officers.
To reduce unnecessary adjustments during project execution, the BPP also directed all MDAs to begin procurements only with approved and completed project designs.
It warned that agencies using incomplete or defective designs that later result in avoidable contract variations could face regulatory penalties.
As part of transparency measures, all MDAs must now publicly disclose details of approved contract variations on their official websites and the BPP portal within 30 days.
The information must include the contractor’s name, original contract amount, additional approved sum, revised contract value and reasons for the increase.
The guidelines take immediate effect and will apply to both new and ongoing government projects across the country.
