FG N4 trn, debt to contractors undermining economic development

Members of the All Indigenous Contractors Association of Nigeria say the continued denial of payments for executed federal government projects undermines national economic development.

The contractors on Monday resumed protests in Abuja, demanding the release of about N4 trillion allegedly owed them for projects executed under the 2024 federal government budget.

The protesters barricaded the entrance of the Federal Ministry of Finance, insisting they would not vacate the premises until their outstanding payments were settled.

Speaking to journalists on Tuesday, the second day of the protest, Johnson Akinsehinwa, a national executive member of AICAN, said the non-payment of contractors was not in the country’s best interest.

Mr Akinsehinwa warned that persistent denial of contractors’ funds could weaken the economy and expose contractors to severe financial losses.
He said the situation could also fuel unemployment and social vices such as insecurity, banditry, and insurgency, especially among idle youths.

According to him, many of the protesting contractors employ numerous workers who are directly affected by the government’s failure to release payments for completed projects.

“Nigeria’s economy largely depends on government spending. Apart from oil and a few agricultural products, we are not a major exporting country. Government releases are what stimulate economic activities,” Mr Akinsehinwa said.

Mr Akinsehinwa added that delays in implementing budgets further worsen the situation, noting that the 2024 budget had reportedly been implemented at about 50 per cent.

“When previous budgets are not fully implemented, it becomes difficult to commence subsequent ones. This creates pressure on the economy and affects employment generated through government-induced businesses,” Mr Akinsehinwa said.

He urged the federal government to urgently address the situation by settling outstanding payments, disclosing that negotiations were ongoing to resolve the matter.

Mr Akinsehinwa also said the payments procurement process had been streamlined, appealing to the government to fast-track disbursements.
Also, another AICAN member, Saidu Jega, said the government remained central to resolving the issue.

He noted that the government, through its ministries, departments, and agencies, serves as the procuring entity for capital projects that sustain jobs and livelihoods.

“In executing these contracts, many people are employed, with several dependants relying on them. Economically, the impact is far-reaching,” Mr Jega said. He called on the government to pay contractors promptly to prevent further disruption to economic activities and avoid deepening hardship across affected sectors. NAN