The Federal Government has issued a stern warning to Ministries, Departments, and Agencies (MDAs) over non-compliance with its revised Bottom-Up Cash Planning Policy, stating that defaulters risk losing access to funds for capital projects.
The warning was delivered by Minister of Finance and Coordinating Minister of the Economy, Wale Edun, during a stakeholders’ review meeting on the implementation of the Revised Policy on Cash Management and Bottom-Up Cash Planning, held in Abuja on Thursday.
The meeting, organized by the Office of the Accountant General of the Federation (OAGF), was aimed at reinforcing financial discipline and ensuring strict adherence to fiscal policies designed to improve transparency and efficiency in government spending.
FG to MDAs: No Compliance, No Funds
Addressing the gathering, Edun underscored the importance of the policy, which was introduced in 2023 and incorporated into the 2024 budget to streamline financial management across government institutions.
“The implementation of the revised cash management and bottom-up cash-planning policy was approved by Mr. President and reinforced through multiple circulars and guidelines,” Edun stated. “However, there are concerns that some MDAs are still lagging in compliance.”
The Minister revealed that some MDAs had already faced temporary restrictions on the Government Integrated Financial Management Information System (GIFMIS), the central platform for government fund disbursement, due to non-compliance.
“This necessitated a temporary block of access to the GIFMIS platform for some entities, which were later restored when they complied. And I think that will carry on. If you do not comply, then you will be withdrawn from accessing the funds that you need to implement your capital projects,” he warned.
Cash Planning Policy: A Step Towards Fiscal Discipline
The Bottom-Up Cash Planning Policy was introduced as part of the government’s broader effort to enhance financial accountability and optimize resource allocation. Under this framework, capital project payments are now centralized under the Office of the Accountant-General, requiring all MDAs to submit structured cash plans before accessing funds.
According to Edun, this approach will eliminate inefficiencies, prevent financial leakages, and ensure that government spending aligns with available revenue. He reaffirmed the Tinubu administration’s commitment to fiscal discipline, stating that government expenditure will be strictly tied to revenue generation, with no room for excessive borrowing or unrestrained money printing.
Accountant-General Urges Compliance
The Accountant-General of the Federation, Dr. Oluwatoyin Madein, also emphasized the government’s resolve to enforce financial oversight, ensuring that all MDAs adhere strictly to the policy.
“You may recall the issuance of financial documents following Mr. President’s approval for the modification of the Bottom-Up Cash Planning Policy. This initiative was designed to provide a structured framework for the planning and management of limited cash resources, ensuring efficient service delivery,” she stated.
Madein acknowledged that while significant progress had been made since the policy’s introduction, some MDAs had yet to fully integrate the guidelines into their operations, leading to gaps and infractions.
“While we have recorded significant progress, some challenges remain. Some of these challenges have been addressed, while others are at various stages of resolution and will be highlighted in the course of this quarter,” she added.
Reforming Revenue Generation with Technology
Beyond enforcing compliance with cash planning, the Federal Government is also focusing on modernizing revenue collection to boost internally generated revenue (IGR). Edun revealed that increased automation and the adoption of technology would be at the heart of upcoming reforms.
He stressed that fiscal sustainability cannot be achieved through reckless spending or reliance on external borrowing. Instead, the government is pushing for efficiency in revenue generation and expenditure management.
MDAs Urged to Embrace Accountability
In response to the government’s warning, financial analysts have commended the move, stating that stringent enforcement of financial policies will enhance budget performance and curb corruption in public financial management.
Dr. Adamu Suleiman, an economist and public finance expert, described the policy enforcement as “a necessary step to restore discipline in government spending.”
“For too long, MDAs have operated with minimal oversight, leading to waste and mismanagement. This cash planning framework is essential to ensuring that government resources are utilized effectively and that capital projects are executed as planned,” he said.
Another financial expert, Olabisi Adebayo, called on MDAs to align their operations with the new fiscal measures to avoid disruptions in project implementation.
“There is no excuse for non-compliance. The policy is clear, and MDAs must take their financial planning seriously. Government agencies must prioritize accountability if Nigeria is to achieve sustainable economic growth,” Adebayo stated.
Implications for National Development
The government’s renewed focus on enforcing compliance with cash management policies underscores its broader commitment to fiscal discipline. With MDAs required to justify their cash needs before receiving funds, financial experts believe this approach will enhance transparency and ensure funds are directed toward priority projects that benefit Nigerians.
However, some civil servants and agency heads have raised concerns about the bureaucratic bottlenecks associated with the policy. Speaking anonymously, an official from a federal ministry noted that while the policy promotes accountability, it could slow down project execution due to increased administrative processes.
“We understand the need for fiscal discipline, but we also need to ensure that the process does not delay critical projects. There must be a balance between oversight and efficiency,” the official stated.
Despite these concerns, government officials remain adamant that the policy is a step in the right direction. With fiscal transparency as a key priority for the Tinubu administration, the enforcement of this policy signals a shift towards responsible governance and improved financial management.
