The Federal Government has prohibited all Ministries, Departments, and Agencies (MDAs) from entering into contracts denominated in foreign currency, as part of new fiscal control measures under the 2025 Appropriation Act Implementation Guidelines.
According to the directive issued by the Budget Office of the Federation, all government contracts must now be fully priced in Nigerian Naira, except where special approval has been obtained.
“MDAs must ensure that all contracts are exclusively quoted in Nigerian Naira,” the guideline stated. “No MDA is permitted to sign any contract in foreign currency without prior clearance from the Honourable Minister of Finance and Coordinating Minister of the Economy.”
In addition to currency regulations, the new guidelines introduce tighter compliance and reporting requirements. MDAs are now mandated to submit Budget Performance Reports by the 15th of each month, using a standardized format. Failure to meet this requirement will result in the suspension of further capital and recurrent budget disbursements.
This measure is aimed at linking funding to actual project performance and enforcing greater fiscal discipline.
To curb rising personnel expenses, the government will intensify monthly and quarterly audits of nominal rolls to identify and eliminate irregular salary entries. The Budget Office also directed MDAs to halt all direct salary or promotion arrears payments through the Integrated Personnel and Payroll Information System (IPPIS). Instead, such payments must be processed through the Committee on Payment of Promotions and Salary Arrears, as per a directive issued on December 17, 2020.
“All MDAs must submit monthly reports detailing non-regular allowances paid, how they were used, and any unutilized balances,” the document noted.
The Auditor-General of the Federation will oversee compliance with these rules. Furthermore, MDAs are barred from any actions that could increase personnel costs — such as new hires, unauthorized allowances, or staff replacements — without prior approval. Breaches could lead to sanctions against agency heads.
A revised recruitment policy has also been introduced, mandating that future employment applications reflect a balanced academic-to-non-academic staff ratio and include at least five per cent representation of persons with disabilities. Requests for establishment or financial clearance must provide evidence of compliance with these criteria.
On tax matters, the guideline stresses that MDAs do not have the power to grant tax exemptions to contractors.
“All tax waivers or exemptions must go through the proper legal and fiscal approval channels,” the document emphasized.
Agencies that frequently offer tax concessions were warned to remain within the tax expenditure ceilings outlined in the 2025 national budget.
Regarding international aid and development support, all requests must now be channeled through the International Cooperation Department (ICD) of the Ministry of Budget and Economic Planning. Any assistance received — in cash or kind — must be documented and reported monthly to both the ICD and the Office of the Accountant-General of the Federation.
These measures are part of a broader government push to enhance transparency, ensure prudent financial management, and align public spending with its 2025 fiscal goals.
