ICPC reveals how contractors, officials steal public funds

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The Chairman of the Independent Corrupt Practices and Other Related Offences Commission, Musa Aliyu, on Tuesday highlighted recurring methods used by contractors and public officials to divert government funds through the procurement process.

Aliyu, represented by the Commission’s Secretary, Clifford Oparaodu, made the remarks at a one-day procurement engagement workshop held at the ICPC headquarters in Abuja.

According to him, procurement corruption remains the single largest source of financial leakage in Nigeria, with public procurement accounting for an estimated 10 to 25 per cent of the country’s GDP.

He outlined common schemes including contract splitting to bypass approval thresholds, over-invoicing, and cost inflation of 200 to 300 per cent.

Other tactics include phantom contracts that exist only on paper, substandard execution delivering less than half the agreed value, and project abandonment after mobilisation funds are released.

Aliyu also cited collusion between procurement officials and contractors, duplication of identical projects under different names, and repeated inclusion of the same projects in annual budgets.

He said, “Public procurement accounts for an estimated 10 to 25 per cent of Nigeria’s GDP, making it the single largest area of government expenditure and, consequently, the sector with the highest levels of corruption.

“The schemes plaguing Nigeria’s procurement system are extensive, but some of the most prominent and recurrent include contract splitting to circumvent approval thresholds, over-invoicing, and cost inflation of 200 to 300 per cent. Others are phantom contracts that exist only on paper, substandard execution that delivers about 40 per cent value for 100 per cent payment, and project abandonment after mobilisation funds are released.

“Additional issues include collusion between procurement officials and contractors, and duplication of identical projects funded multiple times under different names.

“Many such projects continue to appear in annual budgets despite little or no progress.”

He further noted that some projects are sited on private property belonging to sponsors or associates, while project equipment is often diverted for personal use.

Aliyu recalled that the Commission launched the Constituency and Executive Projects Tracking Initiative in 2019 to monitor project delivery nationwide.

The initiative, he said, exposed structural corruption such as lack of needs assessments, project duplication, poor transition between legislative terms, and networks of collusion involving contractors and project sponsors.

He emphasised that transparency in procurement directly improves citizens’ welfare, noting that the tracking initiative has led to the restoration of schools, health centres, water facilities, and other public services.

Aliyu stressed the need for strict adherence to the Public Procurement Act, which mandates open competitive bidding, publication of procurement information, standardised contract templates, and independent verification of contractors’ capacity.

He also highlighted the importance of e-procurement systems to reduce fraud by creating audit trails and enabling real-time monitoring, calling for improved compliance by public institutions to ensure fairness, competition, and accountability.

Public procurement, a major component of government expenditure, has increasingly become a hotspot for corruption, with substantial public funds diverted through fraudulent practices.

Such corruption slows or halts the delivery of essential services, hinders economic development, and erodes public confidence in government institutions.

The PUNCH journalist, Solomon, has five years experience covering crime, judiciary and defence beats.

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