The Federal Government, in a move to address the grievances of indigenous contractors, has earmarked N1.7 trillion in the 2026 Appropriation Bill to settle outstanding debts owed to them for capital projects executed in 2024.
The allocation, captured under the line item “Provision for 2024 Outstanding Contractor’s Liabilities,” marks a significant attempt by the President Bola Ahmed Tinubu administration to clear a backlog that has stalled critical infrastructure projects and pushed many indigenous firms to the brink of bankruptcy.
In addition to the N1.7 trillion for 2024 liabilities, the government has also budgeted N100 billion for a separate line item titled ‘payment of Local Contractors’ Debts/Other Liabilities’, which may cover legacy debts from previous years, smaller contract claims, or unsettled financial commitments that were not fully verified in the current audit cycle.
The total N1.8 trillion allocation is part of the broader N23.2 trillion capital expenditure in the 2026 fiscal plan, which seeks to ramp up infrastructure delivery while cleaning up past obligations.
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Nigeria’s contractor debt backlog has been a recurring fiscal issue, worsened by delayed capital releases, partial cash-backing of budgeted projects, and underperformance in revenue targets.
Protesters under the aegis of the All Indigenous Contractors Association of Nigeria (AICAN), in 2025, staged several protests in Abuja, picketing the Ministry of Finance and claiming that the government owed them for completed and ongoing capital projects.
They had accused the federal government of refusing to release the funds earmarked in the 2024/2025 budgets.
At the latest protest in December 2025, the contractors protested non-payment of contract fees in excess of N500 billion for federal projects completed in 2024.
The protest led by Babatunde Oyeniyi, General Secretary of the Association, had pitched their canopies at the central gate of the ministry, said the government had reneged on all promises it made during previous negotiations.
With placards of various inscriptions, one of which read ‘Don’t pay 2025 until you finish paying the 2024 budget that has been completed’, they surged towards the entrance of the ministry, thereby disrupting movements in and out of the ministry.
Oyeniyi said, “The demand is that they should just pay us. We have finished our work. All the contractors that have finished their work, they should pay them.
“We are not demanding anything else. We have worked, we have been certified, people have even started using the projects, so they should pay us.”
