The Nigerian Minister of Works, Senator Dave Umahi, has issued a strict directive to contractors holding long-outstanding Advance Payment Guarantees (APGs) to immediately resume work on their assigned federal projects or forfeit any further financial guarantees and payments.
In a firm statement, Umahi condemned the practice where contractors retain government advance payments for years without commencing work, while simultaneously submitting payment certificates for additional funds. He declared such conduct unacceptable. “It is not done anywhere,” the minister stated, adding that he would not approve payment certificates for contractors who have held public funds for four or five years while expecting continued disbursements.
The minister’s order mandates that all contractors with dormant APGs must return to their project sites and deploy the advanced funds for their intended purposes without delay. He warned that financial institutions which allow government funds tied to these guarantees to remain fixed in accounts, even as large payment certificates are processed, will no longer be tolerated. “That time is gone,” Umahi asserted, pledging to continue collaborative efforts with the President to reclaim public resources.
This directive underscores the administration’s renewed focus on accountability and transparency in the management of public infrastructure funds. Advance Payment Guarantees are financial instruments typically issued by banks to secure upfront payments to contractors for major projects, ensuring they have the capital to begin work. Holding these guarantees for extended periods without project execution immobilizes critical public funds and contributes to infrastructure delays.
The move is part of broader efforts by the Federal Government to curtail financial indiscipline in the contracting process and ensure that budgeted allocations translate into tangible development. Minister Umahi’s ultimatum signals a zero-tolerance approach to the hoarding of project advances. Contractors are now expected to comply or risk formal cancellation of their guarantees and possible blacklisting. Observers note that enforcing this policy could unlock significant capital for active projects and improve the efficiency of the national works budget. The next step will involve compliance verification by the Ministry’s monitoring teams.
