The Federal Government has introduced stricter controls on contract variations and cost revisions in Ministries, Departments and Agencies, MDAs, in a fresh move aimed at reducing corruption, project inflation and abuse of public funds.
Under the new rules announced by the Bureau of Public Procurement, BPP, no government agency will be allowed to increase the cost of any contract or alter the scope of projects without first obtaining approval and certification from the Bureau.
The BPP said the decision was part of broader reforms to strengthen transparency and accountability in Nigeria’s procurement process, which has for years faced criticism over inflated contracts, abandoned projects and misuse of public resources.
The new guidelines were announced in a statement issued on Sunday by the Head of Press and Public Relations of the Bureau, Zira Nagga.
According to the statement, the reform was approved by the Federal Executive Council, FEC, and backed by Sections 5(a) and (o) of the Public Procurement Act 2007.
The statement, titled “Contract Variations: BPP Releases Guidelines,” explained that the policy would now centralise the review and approval of all contract variations, fluctuation claims and project scope adjustments under the supervision of the Bureau.
The latest framework replaces an earlier 2013 policy which only required Presidential approval for contract variations above 15 per cent of the original contract sum or above N1 billion.
However, under the new arrangement, every request for any upward review, no matter how small, must first be submitted to the BPP for examination and certification before it can move to the relevant approving authority.
The Bureau also introduced a mandatory “Certificate of No Objection,” which will now serve as a key requirement before any variation can be approved.
According to the guidelines, the certificate will remain valid for six months, and any contract variation processed without it will be treated as a violation of the law.
The Bureau warned that officers responsible for unauthorised approvals could face sanctions under the Public Procurement Act, including suspension from office. Contractors involved in such deals may also be blacklisted or debarred from future government contracts.
Director-General of the BPP, Adebowale Adedokun, said the government was determined to stop the misuse of contract variations as a tool for inflating project costs.
“Variations must not become a backdoor for cost inflation and scope creep,” Adedokun said.
“These guidelines ensure that every adjustment to a public contract is necessary, justified, and delivers value to Nigerians. The BPP will apply these rules rigorously and fairly across all MDAs.”
Over the years, contract variations have remained one of the most controversial issues in Nigeria’s public procurement system. Many government projects that started with smaller budgets later ended up costing several times more after repeated revisions and adjustments.
Critics have often accused some officials and contractors of deliberately using contract variations to divert public funds or award fresh projects without following due process.
In some cases, projects have remained abandoned despite repeated increases in contract sums.
To address the problem, the new guidelines clearly defined the situations where contract variations would be allowed and where they would not.
According to the BPP, acceptable grounds for variation include unforeseen conditions at project sites, genuine design errors, changes in government regulations after contracts have been signed, major economic shocks affecting prices, and force majeure situations such as natural disasters.
The Bureau also said variations may be approved for value engineering improvements that reduce costs without changing the original purpose of the project.
However, the guidelines strongly rejected variations arising from poor planning, avoidable design mistakes or the introduction of entirely new project components not included in the original contract.
The BPP stressed that such additions must be treated as fresh contracts and processed separately through the normal procurement system.
The Bureau also introduced stricter rules on fluctuation claims, which involve requests for additional payments due to changes in prices of labour, materials or foreign exchange rates.
According to the guidelines, contractors found to have deliberately slowed down projects in order to benefit from higher fluctuation claims would lose such claims and could even face sanctions.
The BPP warned that bogus or exaggerated claims could lead to the debarment of contractors from future government projects.
The new policy also revised approval limits for contract variations based on the size of the increase rather than the total revised contract amount.
Under the arrangement, variation requests for works projects above N10 billion will require approval from the Federal Executive Council.
Those between N5 billion and N10 billion will go to the Ministerial Tenders Board, while requests between N75 million and N5 billion will be handled by the Parastatal Tenders Board.
For works below N75 million, as well as goods and services below N50 million, approvals can be granted by the Accounting Officer of the agency involved.
The same structure applies to procurements involving goods and services.
The Bureau also moved to tackle one of the major causes of contract variations — poor project planning and incomplete engineering designs.
Under the new guidelines, all MDAs are now required to use approved final project designs before contracts are awarded.
The use of preliminary or faulty designs that later lead to unnecessary cost increases will attract sanctions from regulators.
This measure is expected to affect contractors and agencies that begin projects without complete technical planning, a problem that has contributed to delays and rising project costs in several public projects across the country.
Transparency is another major focus of the new rules.
The BPP directed all MDAs to publish details of every approved contract variation on their official websites and on the Bureau’s procurement portal within 30 days of approval.
The information to be published includes the contractor’s name, original contract sum, amount added, revised total cost and reasons for the increase.
The Bureau also said it would periodically submit reports to the Federal Executive Council on reviewed and approved contract variations across government agencies.
Anti-corruption groups have long demanded stricter oversight of procurement processes, arguing that contract inflation has contributed heavily to wasteful spending and rising public debt.
The Federal Government has repeatedly promised to reform the procurement system as part of efforts to improve governance, reduce corruption and ensure better use of taxpayers’ money.
According to the BPP, the new guidelines take immediate effect and will apply to all ongoing projects, regardless of when the original contracts were awarded.