President Bola Ahmed Tinubu has introduced a major reform to Nigeria's procurement system, announcing that contracts and procurement of goods and services valued below N5 billion will no longer require Federal Executive Council (FEC) approval.

The announcement was made public in a statement released on Thursday by Zira Nagga, spokesperson for the Bureau of Public Procurement (BPP).

Under the new procurement thresholds, ministries, departments, and agencies (MDAs) will now have greater autonomy to handle procurement processes for contracts valued below the N5 billion mark.

New Procurement Guidelines

According to the BPP statement, "Under the new structure, only contracts valued at N5bn and above for goods and consultancy services and N10bn and above for works will require FEC approval. Projects below these thresholds will be processed at the Ministerial Tenders Board, Parastatal Tenders Board, and by the Accounting Officers based on their respective costs."

The new guidelines also specify that international or national competitive bidding must be used for goods valued at N1 billion and above, and works valued at N5 billion and above.

For smaller procurements, the BPP has permitted Requests for Quotations for goods and non-consultant services valued below N30 million and works valued below N50 million. Additionally, the threshold for prequalification has been set at N500 million and above for goods and non-consultant services, and N1 billion and above for works.

Streamlining Bureaucracy

The federal government agency explained that these new procurement guidelines are necessary to streamline bureaucracy and enhance efficiency in government operations. The BPP emphasized that the thresholds will be subject to periodic reviews, either upward or downward, depending on prevailing economic realities.

"These thresholds will, however, be subject to periodic reviews, either upward or downward, depending on prevailing economic realities to ensure the stability of procurement processes," the statement noted.

Warning Against Non-Compliance

The BPP issued a stern warning against non-compliance with the new guidelines, stating: "Those who decide to flout, abuse, or frustrate the implementation of these revised thresholds will be recommended to Mr President for administrative sanctions, as it will no longer be business as usual."

This procurement reform comes on the heels of President Tinubu's recent approval of the Nigerian First Policy and ban on the importation of certain foreign goods, indicating a broader strategy to reform Nigeria's economic and administrative frameworks.