Disturbed by the manner Ministries, Departments and Agencies of Government, MDAs flagrantly spend money without adequately aligning with Revised Bottom-Up-Cash Management Policy Framework, to this end, the Federal Government welded the big stick by barring MDAs from awarding contracts without warrants.
Ministry of Finance in a circular has ordered that due process must be followed or heavy sanctions awaits such government bodies.
In a circular signed by the Minister of Finance, Taiwo Oyedele in a sighted by this medium, it was expressly stated that :”The revision of this policy will further ensure that MDAs comply with statutory and regulatory provisions governing public financial management”. 
In the memo it was also stated that “It should be noted that Accounting Officers who contravene this policy shall be personally liable for any resultant commitments, in accordance with the provisions of • Financial Regulation 310 (Personal Responsibility for Expenditure • Public Service Rules 030402 (Serious Misconduct • Fiscal Responsibility Act Section 48 (Offences and Penalties – Independent Corrupt Practices and Other Related Offences Act (ICPC Section 22 Sub-sections 4.
Under the new framework, no MDA is permitted to issue letters of award, sign contracts or enter into financial obligations unless the corresponding Warrant or Authority to Incur Expenditure covering the full or committed portion of the contract sum has been duly released by the Honourable Minister of Finance and Coordinating Minister of the Economy to the Accountant General of the Federation.
The circular also makes it clear that budgetary allocations alone do not constitute legal authority to spend public funds.
According to the directive, “Estimates in the Appropriation Act or budgetary provisions do not confer automatic spending authority. Only duly released Warrants/AIE issued by the Honourable Minister of Finance and Coordinating Minister of the Economy in line with Financial Regulation 301 confer legal authority to incur expenditure.”
The policy cites Financial Regulation 415, Section 22 of the Fiscal Responsibility Act, 2007, Section 16(1)(b) of the Public Procurement Act, 2007 and relevant provisions of the Independent Corrupt Practices and Other Related Offences Act as the legal basis for the revised framework.
Government said the new measures are designed to align financial commitments with actual funds availability, strengthen expenditure controls and halt the growing accumulation of unfunded contractual liabilities arising from contracts awarded without the necessary financial backing.
The circular also introduces changes to the cash management process by abolishing the requirement for MDAs to submit monthly cash needs before the issuance of Warrants. Instead, Warrants will be issued based on approved budget implementation priorities and available Capital Development Fund balances.
In addition, all MDAs are required to prepare quarterly cash plans in line with their ministerial priorities and procurement plans for submission to the Office of the Accountant General of the Federation to improve cash flow forecasting and budget execution.
The Federal Government warned that Accounting Officers who disregard the directive would bear personal responsibility for any commitments arising from contracts awarded in violation of the policy.
It stated that such officers would be held liable in accordance with the Financial Regulations, the Public Service Rules, the Fiscal Responsibility Act and other applicable laws governing public financial management.
The directive takes immediate effect and supersedes all previous instructions inconsistent with the revised framework. It also provides that all 2026 capital projects across Federal Ministries, Departments and Agencies shall be implemented in accordance with the new policy.
The government directed all Accounting Officers, Directors and Heads of Finance and Accounts, as well as Internal Audit Departments and Units across MDAs and other arms of government, to ensure strict compliance with the circular.
