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| FG’s new imprest cap promotes fiscal discipline |
The Federal Government has fixed a new cash‑advance limit of ₦700,000 for ministers. A fresh circular explains that ministers may draw up to that sum in a single imprest without special approval. The rule takes effect immediately and applies to all top officials across ministries, departments, and agencies .
Under the circular signed by the Finance Minister, ministers may now receive up to ₦700,000 per cash‑advance request. Permanent secretaries and agency heads may draw ₦500,000. Department directors get ₦300,000, while state formation heads may draw ₦100,000 . The move aims to harmonize spending limits and curb unchecked advances.
Officials must retire all advances each quarter. In special cases, they may request twice‑quarterly reimbursements. Advances beyond those limits halt until proper approvals are secured. Purchases over ₦1,000,000 now need formal procurement under the Public Procurement Act, 2007 .
To boost accountability, all imprest holders must open bank accounts for fund management. Monthly returns must go to the Accountant‑General’s office. The Treasury Inspectorate will inspect records regularly. Violations may strip officers of imprest rights and invite discipline .
This change builds on past limits. In 2023, ministers drew up to ₦1.5 million for works contracts. But complaints arose about contract splitting and bypassing procurement rules . The new imprest cap halts advance abuse and forces stricter adherence to financial rules.
Budget analysts say this step may cut frivolous spending. They note that ministers often drew advances for unvetted expenses. A lower imprest limit may force tighter planning. But critics warn that rigid caps could hamper urgent tasks and small‑scale events.
A senior budget expert said the cap could slow project kick‑offs. He argued that quick advances help ministers meet local demands. Yet he agreed the rules would rein in unchecked spending. He suggested bi‑monthly reviews to balance flexibility with control.
Civil‑society groups welcomed the move. BudgIT noted that imprest abuses drained public funds without clear audits. The group urged full compliance and called for real‑time online reports of advances. They see transparency as vital for public trust.
Lawmakers have mixed views. Some senators praised the cap as a cost‑cutting tool. Others argued it shifts more bottlenecks to permanent secretaries. They urged a review after six months to adjust limits if needed.
The circular also instructs agencies to submit 2024 imprest details. They must list past imprest holders and locations. This archive will help the Accountant‑General spot irregularities before further disbursements.
Finance Ministry insiders say the move aligns with President Tinubu’s vow to check waste. His administration has paused some ministerial threshold increases . It aims to reduce unplanned outlays until procurement processes settle.
Experts point out the new cap sits alongside broader reforms. The FG this year launched a single‑window payment system for over 700 MDAs. That centralization seeks to curb delays but drew criticism for stifling agency autonomy .
Procurement watchdogs believe the imprest cap will link smoothly with the new payment system. They expect faster retirements and fewer pending advances in agency ledgers. But they stress the need for user‑friendly software to avoid extra paperwork.
Civil‑society groups also call for public dashboards. They want citizens to track imprest drawdowns in real time. That, they say, will deter misuse and help watchdogs flag anomalies fast.
Some ministry insiders worry about stricter inspections. They say Treasury visits could disrupt normal routines. Yet most agree the change will sharpen officers’ planning, forcing them to justify needs before advances.
Local press praised the reform as a bold fiscal step. Editorials noted that many MDAs held large unused imprest balances each year. Those idle funds often lapsed back without clear accounting.
Opposition voices worried about uneven impacts. They said smaller MDAs would feel the cap more sharply than larger ministries. They urged supplementary allocations for critical functions like health and security.
At the Union Conference last week, civic leaders urged full enforcement. They said half‑measures risked sending mixed signals. They recommended public training for agency accountants to handle the new rules.
Government spokespeople promise regular reviews. They say the first audit will come in October, six months after implementation. That review may adjust ceilings or tweak procedures based on feedback.
Agencies must file their first monthly returns by August. Those that miss the deadline face delays in further advances. The Accountant‑General’s office will publish a compliance scorecard by December.
Analysts say the move may save billions yearly. They estimate that trimming ministerial advances from previous highs could cut waste by 20–30%. Yet they caution that savings hinge on strict enforcement and full reporting.
Former budget directors praised the cap. They said it restores discipline lost under past regimes. They recalled years when advances ballooned without audits, leaving gaps in annual accounts.
A retired Accountant‑General noted that past imprest abuses forced mid‑year budget reviews. He said the new rule will help lock down fiscal plans early, reducing mid‑stream cash calls.
Some civil groups urge linking imprest caps to performance metrics. They say tying advances to project completion rates could boost service delivery. They envision a system where efficient agencies earn higher limits.
Digital‑finance experts recommend integrating imprest reporting with the Treasury Single Account (TSA). They say linking to TSA could automate retirements and spot unretired advances in real time.
While many applaud the cap, a few experts warn against one‑size‑fits‑all limits. They propose sector‑based ceilings. For example, security ministries might need higher imprest for rapid responses. Health agencies may need larger advances during outbreaks.
The FG has not yet addressed sector‑based caps. But insiders say the next circular may allow exceptions for critical agencies. Those exceptions will require cabinet approval.
As the new cap takes effect, ministries are training staff on fresh procedures. Workshops are underway in Abuja and all states. Trainers stress the need for accurate record‑keeping and timely retirements.
Some accountants complain about extra forms. They say the monthly return template is too detailed. The Accountant‑General’s office has promised to simplify the template after initial feedback.
Local auditors believe the reform will yield better audit trails. They say fewer unretired advances means clearer year‑end reports. That should speed up audits and reduce queries from anti‑graft agencies.
Transparency advocates urge photo‑uploads of imprest receipts on agency portals. That, they argue, would add another layer of proof and deter fake claims.
The circular also bans clustering of advances to bypass limits. It warns that officers splitting requests across categories will face sanctions.
Across the country, agencies are scrambling to update their manuals. Many had to rewrite imprest chapters to reflect new ceilings and procedures.
Public finance experts say training must reach remote offices too. They note that some agencies in states still struggle with digital reporting. They call on the FG to support internet upgrades for all agencies.
At month‑end, ministry communication units will post brief reports on their websites. They must detail total monthly imprest usage and retirements. This move aims to engage citizens directly in monitoring spending.
Budget scholars say this form of outward disclosure can foster civic engagement. When citizens see data, they can question anomalies and demand answers. That helps plug leakages.
While initial reactions mix praise with caution, many agree the new imprest limit is a positive step. It tightens fiscal discipline and pushes agencies to plan ahead. It may reshape how the FG disburses funds at the top level.
For now, all eyes are on August returns. That will reveal how well agencies adapt to the new rule. Will they meet deadlines? Will retirements reflect true expenses? The answers will guide further tweaks.